A firm has redesigned its production process so that it now takes 8 hours for a unit to be made. Using the old process, it took 15 hoursto make a unit. The process makes two unit each hour, on average, and each unit is worth $2,000.What is the reduction in work-in-process value?

Production process take time(T) = 8 hour Old process take time(t) = 15 hour Flow rate(R) = 2 units…

Answered: A firm has redesigned its production…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter4: Linear Programming Models

Section4.8: Data Envelopment Analysis (dea)

Problem 41P

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A firm has redesigned its production process so that it now takes 8 hours for a unit to be made. Using the old process, it took 15 hours to make a unit. The process makes two unit each hour, on average, and each unit is worth $2,000. What is the reduction in work-in-process value?