Question: Problem 5-2 (Static) In a job shop, effective capacity is only 50 percent of design capacity, and actual output is 80 percent of effective capacity.

Problem 5-2 (Static) In a job shop, effective capacity is only 50 percent of design capacity, and actual output is 80 percent of effective capacity. What design capacity would be needed to achieve an actual output of eight jobs per week? A producer of pottery is considering the addition of a new plant to absorb the backlog of demand that now exists. The primary location being considered will have fixed costs of $9,200 per month and variable costs of 70 cents per unit produced. Each item is sold to retallers at a price that averages 90 cents. a What volume per month is required in order to break even? b-1. What profit would be realized on a monthly volume of 61.000 units? b-2. What profit would be realized on a monthly volume of 87,000 units? Profit

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