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A printing company receives an order for 15,000 printed pamphlets. Either of two methods can be used to make the pamphlets. Method A requires 2 hours of preparation time. Method B requires 30 minutes of preparation time. Method A will produce copies at a cost of $5 per hundred for the 1,000, $4 per hundred for the next 1,000, and $3.50 per hundred for additional copies. Method B will produce copies at a cost of $7 per hundred for the first 1,000, $5 per hundred for the first 1,000, $5 per hundred for the second 1,000, and $4 per hundred for additional copies. Preparation time is charged at a rate of $40 an hour. Draw a graph of the costs. Read from the graph: a. Number of copies at which the costs of the two methods are equal. b. Cost to produce 5,000 copies using Method A. c. Cost to produce 5,000 copies using Method B. d. Method of choice if 1,000 pamphlets are ordered.

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92520418

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