A manufacturing firm needs to schedule monthly production of two seasonal items for the next 6 months. The unit production cost of Item A is estimated to be $15 for the first 2 months, $16 for the third and fourth months, and $18 for the last two months. The unit production cost for Item B is estimated to be $8 for the first three months and $10 for the last three months. The monthly demands for Item A are 200, 250, 400, 650, 700, 450 units, and the monthly demands for Item B are 160, 180, 370, 500, 420, 350 units. The firm can produce a maximum of 800 units per month. Excess production can be stored from one month to the next at a cost of $2 per unit, but a maximum of 200 total units can be stored in any given month. Assuming that beginning inventory levels are zero, how should the production be scheduled so as to minimize the total costs?
Case study regarding the boosting efficiency at Matsushita
Describe the literal approach to contractual interpretation and explain how it may cause problems. Provide an example to illustrate your point. How might other approaches overcome this difficulty? Describe and explain them in the business context.
“Reliance damages cannot be used to escape the consequences of a bad bargain.”
Explain the meaning of that statement in the context of business contracts. Explain the justification for that legal principle. Provide an example that illustrates your explanations.
You own a t-shirt screen printing company called Back the Pack. Back the Pack operates as a regular Corporation under Subchapter C of the Internal Revenue Code. Back the Pack incorporated on April 1, 2012 and business began on June 1, 2012. The company owns the building that the store is located in and all of the equipment that the business uses. The tax year for the Corporation is the calendar year and it is on the accrual method. The tax identification number for Back the Pack is 12345678.
1) A machine at the Dream Mix Company fills boxes with cereals. The labeled weight of the boxes is 9.4 ounces, with +/- 0.9 ounce. The company wants to construct 3-sigma control charts to monitor the filling process and make sure the box weights are in control. The quality control department for the company sampled five boxes every 2 hours for six cycles. The sample observations are as follows.
Sample Box Weights
1 9.06 9.13 8.97 8.85 8.46
2 8.52 8.61 9.09 9.21 8.95
3 9.35 8.95 9.2 9.03 8.42
4 9.17 9.21 9.05 9.01 9.53
5 9.21 8.87 8.71 9.05 9.35
6 8.74 8.35 8.5 9.06 8.89
a) Construct 3sigma control charts
b) The quality control department collected observation for another six cycles. Plot the corresponding values on control charts
In 1929 there were more than 25,000 commercial banks in the U.S. Today there are still approximately 7000 banks. In most other countries there are just a handful of major banks – often 4 to 8 institutions dominate the market place. What explains the vastly different character of the banking system in the U.S. from that of other countries? Similarly, most other countries have not in the past provided government sponsored deposit insurance, though some have put it in place as part of their response to the credit crisis. Does the unique structure of the U.S. banking system indicate a greater need for such insurance?
As the case study notes, the banking panic of 1933 was not unique. There had been many previous banking panics periodically over the previous century. What made the banking panic of 1933 so extraordinary that it required significant action on the part of the U.S. government?
Similarly, what was so extraordinary about the credit crisis of 2007-2010 that it has become the centerpiece of economic policy and required such unusual actions as bailouts, government injections of equity into financial institutions, emergency lending facilities, etc.?
Perhaps the best known quotation of Roosevelt’s was “The only thing we have to fear is fear itself”. How does the thought behind that quotation fit into the provision of Federal deposit insurance? How does it relate to the response by governments around the world to the current credit crisis?