BUS 371 Production & Operations Management

BUS 371 Production & Operations Management

Assignment # 2

BUS 371 Production & Operations Management

Due on:Monday, 11.5.2009 for Sections 82521 & 82522

Note: No late submission is permitted under any circumstance. Submission will be

accepted only in the classroom at the end of the lecture, in person.

Submit assignments only in handwritten form.

Directions for problems: Write the equations and explain the terms before substitution and put appropriate units after getting the answer.

1. What are the reasons for product or service design and redesign?

2. State the advantages and disadvantages of standardization.

  1. Describe the term mass customization and explain two methods to achieve the same and give one example of each method.
  2. Explain the terms: I) robust design ii) reverse engineering iii) remanufacturing iv) outsourcing v) product liability
  3. Differentiate and state the reasons for economies of scale and diseconomies of scale.

6. Draw a diagram and derive the formula for finding Break-Even Quantity and explaining the terms used in it.

7. The manager of a fast food restaurant featuring burgers is adding salads to the menu. There are two options and the price to the customer will be same for each. The make option is to install a salad bar stacked with vegetables, fruits and toppings and let the customer assemble the salad. The salad bar would have to be leased and a part time employee hired. The manager estimates fixed costs as $12,000 and variable cost per salad as $1.50 per salad. The buy option is to have pre-assembled salads available for sale. They would be purchased from a local supplier at $2.00 per salad. At which demand quantity manager should consider making the salad instead of buying it from outside and selling.

  1. A flower shop faces the following problem in decision making regarding whether to go for low ordering (25 dozens), medium ordering (60 dozens)or high ordering (130 dozens). Construct a payoff table and arrive at decisions based on :
  2. Maximin
  3. Maximax
  4. Laplace
  5. Minimax regret

Demand for red roses

Alternative Low (25 dozens) Medium (60 dozens) High (130 dozens)

Order 25 dozensSAR 1000625625

Order 60 dozens 10020001500

Order 130 dozens (950) 4504000

  1. Analyze the following decision tree and make your decision.

i. Mark Pay off for each branch.

ii. Show pruning clearly. GO TO NEXT PAGE FOR DIAGRAM

  1. Draw a precedence diagram for the following data and group the tasks into work stations and group tasks into work stations for achieving line balance based on positional weight method. Assume an 8 hours work day and an output rate of 40 pieces/day.

Go to next Page for data

TaskPrecedenceTime (Min)

ANone6

BA2

CB2

DA1

EA7

FA5

GC6

HD,E,F5

IH3

JG5

KI,J4

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