Table 7.5 A Company Makes Four Products That Have the Following Characteristics

question 19

Multiple Choice

Table 7.5
A company makes four products that have the following characteristics: Product A sells for $50 but needs $10 of materials and $15 of labor to produce;Product B sells for $75 but needs $30 of materials and $15 of labor to produce;Product C sells for $100 but needs $50 of materials and $30 of labor to produce;Product D sells for $150 but needs $75 of materials and $40 of labor to produce.The processing requirements for each product on each of the four machines are shown in the table. Work centers W,X,Y,and Z are available for 40 hours per week and have no setup time when switching between products.Market demand for each product is 80 units per week.In the questions that follow,the traditional method refers to maximizing the contribution margin per unit for each product,and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product.
-Use the information in Table 7.5.Which work center is of greatest concern to the operations manager?

• A)Work Center W
• B)Work Center X
• C)Work Center Y
• D)Work Center Z

Recognize the difference between informational and normative social influences.

Identify situations of social facilitation and how it affects performance.

Comprehend the phenomenon of social loafing and its impact on group performance.

Grasp the concept and examples of groupthink and its potential negative outcomes.

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Definitions:

Corn Future

A standardized contract to buy or sell a specified amount of corn at a future date and price, traded on commodities exchanges.

Spot Price

The prevailing market rate where a specific asset, including commodities, currencies, or securities, can be purchased or sold for prompt distribution.

Loss

The reduction in the value of an investment or the difference between the purchase price and the lower selling price.

Basis Risk

The risk that the price of a futures contract may not move in tandem with the price of the underlying asset, leading to potential losses in a hedging strategy.