BA $360$ Operations Management $-$ Practice Problems

Chapter $1$: Operations

Problem #$1-1$:

Riverside Metal Works produces cast bronze valves on a $10-$person assembly line. ON a recent day, $160$ valves were produced during an $8-$hour shift.

a$.$ calculate the labor productivity of the line

b$.$ the manager at Riverside changed the layout and was able to increase production to $180$ units per $8-$hour shift. What is the new labor productivity per labor hour?

c$.$ what is the percentage of productivity increase?

Problem #$1-2$:

A hamburger factory produces $50,000$ hamburgers each week. The equipment used costs $$5,000$ and will remain productive for three years. The labor cost per year is $$8,000.$

What is the productivity measure of "units of output per dollar of input" averaged over the threeyear period?

We have the option of buying $$10,000$ of equipment, with an operating life of five years. It would reduce labor costs to $$4,000$ per year. Should we consider purchasing this equipment $($using productivity arguments alone$)?$

Problem #$1-3$:

A fast$-$food restaurant has a drive$-$through window and during peak lunch times can handle a maximum of $80$ cars per hour with one person taking orders, assembling them, and acting as cashier. The average sale per order is $$5\mathrm{.}00.$ A proposal has been made to add two workers and divide the tasks among the three. One will take orders, the second will assemble them, and the third will act as cashier. With this system it is estimated that $120$ cars per hour can be serviced. All workers earn the minimum wage. Use productivity arguments to recommend whether or not to change the current system.