Hickory Manufacturing Company forecasts

  

Answer the following questions
 
6. Hickory Manufacturing Company forecasts the following demand for a product (in thousands of units) over the next 5 years: Year 1 23 4 5 Forecast demand 60 79 81 84 84 Currently the manufacturer has seven machines that operate on a two-shift (eight hours each) basis. Twenty days per year are available for scheduled maintenance of equipment with no process output. Assume there are 250 workdays in a year. Each manufactured good takes 25 minutes to produce.
a. What is the capacity of the factory?
b. At what capacity levels (percentage of normal capacity) would the firm be operating over the next 5 years based on the forecasted demand? (Hint: Compute the ratio of demand to capacity for each year.)
c. Does the firm need to buy more machines? If so, how many? When? If not, justify.
 
7. The roller coaster at Treasure Island Amusement Park consists of 16 cars, each of which can carry up to three passengers. According to a time study, each run takes 2.5 minutes, and the time to unload and load riders is 3.5 minutes. What is the maximum effective capacity of the system in number of passengers per hour?

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