Question: A 4-step process has yields of 50% at Step 1, 60% at Step 2, 100% at Step 3, and 90% at Step 4. Processing time
A 4-step process has yields of 50% at Step 1, 60% at Step 2, 100% at Step 3, and 90% at Step 4. Processing time per flow unit is 2 minutes at Step 1, 3 minutes at Step 2, 2 minutes at Step 3, and 5 minutes at Step 4. Step 1, with 2 employees, can work 160 minutes per hour, while the other three steps can work 60 minutes each per hour. Total labor cost is $200 per hour. Identify the bottleneck step. Estimate hourly capacity and labor cost per unit.
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