Consider a Production Line with Five Stations

question 40

Multiple Choice

Consider a production line with five stations. The first station can process a unit in 8 minutes. The second station has two identical machines, each of which can process a unit in 18 minutes (each unit only needs to be processed on one of the two machines) . The third station can process a unit in 4 minutes. The fourth station has two different machines, one can process a unit in 5 minutes, and the other one can process a unit in 9 minutes (each unit needs to be processed on both machines) . The fifth station can process a unit in 10 minutes. Which station is the bottleneck station?

• A) Station 1
• B) Station 2
• C) Station 3
• D) Station 4
• E) Station 5

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Definitions:

Economic Profit

The financial gain achieved by a firm or individual after deducting both explicit (direct) and implicit (indirect, such as opportunity costs) costs from total revenues.

Investment

Committing funds to assets with the goal of earning returns over time.

Interest Rate

The percentage charged on the total amount borrowed or earned on investments, representing the cost of borrowing or the gain on saved or invested money.

Capital Market

Refers to financial markets where long-term debt or equity-backed securities are bought and sold.