A Certain Manufacturer Is Interested in Evaluating Two Alternative Manufacturing

question 94

Multiple Choice

A certain manufacturer is interested in evaluating two alternative manufacturing plans consisting of different machine layouts. Because of union rules, hours of operation vary greatly for this particular manufacturer from one day to the next. Twenty-eight random working days were selected and each plan was monitored and the number of items produced each day was recorded. some of the collected data is shown below:

$$\begin{array} { c | c | c } \text { DAY } & \text { PLAN 1 OUTPUT } & \text { PLAN 2 OUTPUT } \\\hline 1 & 1234 \text { units } & 1311 \text { units } \\2 & 1355 \text { units } & 1366 \text { units } \\3 & 1300 \text { units } & 1289 \text { units }\end{array}$$ What type of analysis will best allow the manufacturer to determine which plan is more effective?

• A) An independent samples comparison of population means.
• B) An independent samples comparison of population proportions.
• C) A paired difference comparison of population means.
• D) A test of a single population proportion.

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Definitions:

Economies of Scale

Refers to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale.

Diminishing Returns

A principle stating that if one factor of production is increased while other factors are held constant, the output per unit of the variable factor will eventually decrease.

Fixed Resources

Assets and inputs in production that remain constant regardless of the level of output.

Diseconomies of Scale

A condition in which a firm experiences an increase in average costs as it increases its output, due to factors such as inefficiencies or complexity.