Question: metters cabinets inc needs to choose a production method for...
Metters Cabinets, Inc., needs to choose a production method for its new office shelf, the Maxistand. To help accomplish this, the firm has gathered the following production cost data:
Process Type Annualized Fixed Cost of Plant &
Equipment Labor Material
Mass Customization $1,400,000 30 18 12
Intermittent $1,000,000 24 26 20
Repetitive $1,625,000 28 15 12
Continuous $1,960,000 25 15 10
Metters Cabinets projects an annual demand of 24,000 units for the Maxistand. The selling price for the Maxistand is $120 per unit.
a) Based on the projected annual demand, the best alternative available is to use the
Intermittent, Continuous, Repetetive, or Mass Customization (?)