590-2008spring-t2 - c. Explain the method for obtaining the...

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1 Name _________________________________ Email address _____________________________ (last name only) IE 590 - Manufacturing Economics Spring 2008 Test No. 2 Closed Book, Closed Notes 5 questions; 10 points each; maximum score of 50 points 75 minutes; approximately 15 minutes per question Be brief; use illustrations if applicable DO NOT WRITE on the back of the test sheets _________________________________ Q1. Discuss the impact of technological breakthrough on equipment replacement decisions.
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2 Name _________________________________ (last name only)
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3 Name _________________________________ (last name only) Q2. Explain the differences among replacement models 1, 2 & 3. Use graphical illustrations but DO NOT perform numerical calculations.
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4 Name _________________________________ (last name only)
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5 Name _________________________________ (last name only) Q3. Given the graph below: a. Explain the method for calculating the maximum production level. b. Explain the method for determining the maximum profit level.
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Unformatted text preview: c. Explain the method for obtaining the shutdown point. Also provide possible impacts of a shutdown of one of several production lines. 6 Name _________________________________ (last name only) 7 Name _________________________________ (last name only) Q4. Explain the impact of a dual pricing policy in the context of high-volume production. 8 Name _________________________________ (last name only) 9 Name _________________________________ (last name only) Q5. Consider the production function y = 1.5 x + x 2- .05 x 3 a. Determine the input level that will maximize profit. Assume that the unit price of input is $50 and the unit selling price of output is $10. b. Is the input level at maximum output the same as the input level at maximum profit. c. If the unit price of input increase by 15%, what should the firm do if it wants to maximize profit? 10 Name _________________________________ (last name only)...
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590-2008spring-t2 - c. Explain the method for obtaining the...

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