Aquaguard manufactures three models of water purifiers in three separate plants at Taiwan. These plants serve the demand in Europe. All three models sell at a unit price of $100 and the holding cost is 5% of the selling price per month. The monthly demand for these models is normally distributed with the following parameters:
Model 1: Mean 1000, SD 300
Model 2: Mean 1000, SD 300
Model 3: Mean 1000, SD 300
The demand for Model 1 and Model 2 has a correlation coefficient of (-) 0.35, while that for Model 3 is independent of the other two models. The company wishes to make two of the models in one plant by using flexible technology.
Required:
a) Which two models should Aquaguard choose in order to minimize production variability in the new plant? (as measured by the coefficient of variation).
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Aquaguard manufactures three models of water purifiers in three separate plants at Taiwan. These plants serve the demand in Europe. All ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
A company can sell all the units it can produce of either Product A or Product B but not both. Product A has a unit contribution margin of $32 and takes two machine hours to make and Product B has a unit contribution margin of $60 and takes three
Answers (1)
You want to create a $48,000 portfolio that consists of three stocks and has an expected return of 14.5 percent. currently, you own $16,700 of stock a and $24,200 of stock b. the expected return for stock a is 18.7 percent, and for stock b it is 11.
Answers (1)
What should you do if your supervisor asks you to do something that you do not believe is safe?
Answers (2)
Where was the first Starbucks in New York City?
Answers (1)
Proceeds of debt issued for the construction or acquisition of capital assets are recognized by the capital projects fund as "other financing sources" and as a liability in the governmental activities journal. A. TRUEB. FALSE
Answers (1)
New Questions in Business
Brian brewster sold property to a buyer who paid him $400,000 cash and assumed an existing mortgage of $150,000
Answers (1)
The following inventory information was taken from the records of Kleinfeld Inc.: Historical cost $12,000 Replacement cost $7,000 Expected selling Price $9,000 Expected selling cost $500 Normal profit margin 50% of price Assume that subsequent to
Answers (1)
Eliza has a policy that allows her to deduct the premiums she pays that exceed 10% of her adjusted gross income. Once she turns 65, she can deduct the premiums that exceed 7.5% of her adjusted gross income. Which type of policy does Eliza have?
Answers (1)
A key consideration related to business intelligence is that it focuses on data to aid in
Answers (1)
For franklin, inc., sales is $1,500,000, fixed expenses are $450,000, and the contribution margin ratio is 36%. what are the total variable expenses?
Answers (1)