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United Research Associates (URA) had received a contract to produce two units of a new cruise missile guidance control. The first unit took 5,000 hours to complete and cost $50,000 in materials and equipment usage. The second took 4,000 hours and cost $37,500 in materials and equipment usage. Labor cost is charged at $25 per hour.
The prime contractor has now approached URA and asked to submit a bid for the cost of producing another 20 guidance controls.
1. What will the last unit cost to build?
2. What will be the average time for the 20 missile guidance controls?
3. What will be the average cost for the guidance control for the 20 in the contract?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M9375972

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