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2. Tuff-Rider, Inc., manufactures touring bikes and mountain bikes in a variety of frame sizes, colors, and

component combinations. Identical bicycles are produced in lots of 100. The project demand, lot size, and time standards are shown in the following table: Item Touring Mountain Demand forecast 5,000 units/year 10,000 units/year Lot size 100 units 100 units Standard processing time .25 hour/unit .50 hour/lot Standard setup time 2 hours/lot 3 hours/lot The shop currently works 8 hours per day, 5 days a week, 50 weeks a year. It operates 5 workstations, each producing one bicycle in the time shown in the table. The shop maintains a 15 percent capacity cushion. How many workstations will be required next year to meet expected demand without using overtime and without decreasing the firms current capacity cushion?

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Demand Forecast (units per year)
Lot Size (units)
Standard Processing Time (hrs/Unit)
Standard Setup Time (hrs/Lot) Touring
2 Mountain
3 Design Capcaity (units per...

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