A study made in the assembly department of a small electronics manufacturing firm revealed that workers typically produce 100 to 150 assemblies in an 8-hour workday. For simplicity, assume the production rates are 100, 125, or 150 units per day. If 100 units are produced, an average of 3 percent are rejected. When 125 units are produced, an average of 8 percent are rejected. At the 150 units/day rate, 20 percent are rejected. The total material costs per unit are \($5.50\), and rejected units are worthless scrap. Workers are paid \($1.40\) per acceptable assembly.

a. What is the preferred production rate from the worker’s point of view?

b. Which production rate results in the lowest unit cost per acceptable unit for the company?