hw5.docx

# hw5.docx - Problem 8.1 The labor cost per unit of each...

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Problem 8.1 The labor cost per unit of each alternative: Myanmar: 6 3 40 = \$ 0.45 per unit Rural China: 10 2 45 = \$ 0.44 per unit Billings: ( 2 60 )/ 100 = \$ 1.2 per unit Rural China has the lowest labor cost per unit, so rural China is the most economical to produce the item. Problem 8.2 The labor plus transportation cost per unit of each alternative: Myanmar: 0.45 + 1.5 = \$ 1.95 per unit Rural China: 0.44 + 1 = \$ 1.44 per unit

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Billings: 1.2 + 0.25 = \$ 1.45 per unit Rural China has the lowest labor plus transportation cost per unit, so rural China is the most favorable location to produce the item. Problem 8.9 a) AKRON site rating calculation demonstration: 0.15*90+0.1*95+0.3*80+0.15*60+0.2*90+0.1*75=81.5 The composite rating for each location can be calculated in Excel as the follow: weight AKRON BILOXI CARTHAG E DENVE R 0.15 90 80 90 80 0.1 95 75 65 85 0.3 80 85 95 85 0.15 60 80 90 70 0.2 90 75 85 60 0.1 75 80 85 75 81.5 80 87.5 76 b) CARTHAGE has the highest rating overall, so CARTHAGE site should be chosen. c) If the labor cost weights 0.3 and the operating cost weights 0.1, the new composite rating is as follow: weight AKRON BILOXI
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• Spring '14
• FredPhillips

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