Posted: February 7th, 2016

Evaluating three manufacturing systems for different volumes

7.7 Using the data in Problem 7.5 determine the best process for each of the following volumes:
(1) 75,000, (2) 275,000, (3) 375,000

7.5 GENERAL
PURPOSE FLEXIBLE DEDICATED
EQUIPMENT MANUFACTURING MACHINE
(GPE) SYSTEM (FMS) (DM)
Annual contracted
Units 200,000 200,000 200,000
Annual fixed cost $100,000 $200,000 $500,000
Per unit variable
Cost $ 15.00 $ 14.00 $ 13.00