profits and very high costs at its plants in Germany and Japan. Landgraf‚ the company ’s president for worldwide operations‚ knew that demand for the company ’s products was stable across the globe. As a result‚ the surplus capacity in his global production network looked like a luxury he could no longer afford. Any improvement in financial performance was dependent on having the most efficient network in place‚ because revenues were unlikely to grow.. Cutting costs was thus a top priority for the
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HQ functions and approaches in a multi-business firm? In economies of scale lower cost of goods sold by leveraging increased production volume and sales. This occurs when costs measured on a per item basis decrease as a result of fixed costs being divided among more items being produced. This higher yield on fixed costs is normally associated more with the production aspects of a business. Ultimately‚ savings can be passed on to the consumers if the characteristics of the products are capable
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generation‚ founded initially in 1922 by Gunnar Pelarsen and now run by granddaughter and CEO Ingrid Pelarsen. The 1990s was an era of craftsmanship. One of the noted success factors for Pelarsen Windows at the time was its transition from craft to mass production. Pelarsen was a mover in streamlining the windows manufacturing process by standardizing the various components‚ allowing windows to be assembled in larger volumes and at remote locations. Another one of its key success factors was its innovative
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BUSINESS ECONOMICS COURSEWORK 2 ADBM Answer 1(a) Demand and supply curves are graphical representations of the relationships between price and quantity. When we know the relationship we can easily find the relationship by easy algebra. General equation a linear (straight-line) demand curve is P = a -bQD Placing the price on the Y axis and the quantity demanded on the X axis. a=Y intercept; -b=slope Clearly‚ a must be positive‚ and the minus sign on b indicates that quantity demanded
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Demands of the question 10 marks (paper 2) 20 minutes on it Explain the law of diminishing returns using average and marginal product curves Definition Law of diminishing returns refer to how the marginal production of a factor of production starts to progressively decrease as the factor is increased‚ in contrast to the increase that would otherwise be normally expected. Triple A Law of diminishing returns – as more and more of a variable factor is added to a fixed factor‚ output will
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PROCESS ANALYSIS Elements of a process: Process: Any part of an organization that takes inputs and transforms them into outputs that add value to the organization/customer. Some examples: Product | Fast Food | Automobile | Hospital | Inputs | Meat‚tomato‚onions‚buns‚equipment | Parts‚labour‚assembly line‚energy | Equipment‚doctors‚nurses‚technicians‚patient | Process | Cooking and assembly | assembly | treatment | Outputs | Burger | car | Healthy patient | Class Discussion: Airlines
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| | | b. Plot the (i) total product‚ (ii) marginal product‚ and (iii) average product functions. c. Determine the boundaries of the three stages of production. 6. Consider that following short-run production function (where L = variable input‚ Q = output): Q = 10L – 0.5 L2 Suppose that output can be sold for $10 per unit. Also assume that the firm can obtain as much of the variable input (L) as it
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because they break the link between the cause for the costs and the basis for assignment of the costs to the individual products. Costs may vary not only with respect to volume of production‚ but also‚ for example‚ with batch-related activities (e.g.‚ changeovers‚ setups‚ and inspection of the first item of production run) and the number of products (e.g.‚ scheduling materials receipts and improving products). Also‚ cost distortions tend to be greater with greater differences between relative proportions
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good from a change in its relative price 10 The goal of a rational consumer is to maximize: Total utility from all goods consumed 11 Economic profits are: Equal to the difference between accounting profits and implicit cost 12 Which is most likely to be a long-run adjustment for a firm that manufactures cars on an assembly line basis? A change in production to a redesigned and retooled facility 13 the law of diminishing returns in a manufacturing plant of a fixed capacity implies that‚ eventually
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Managing Business Process Flows: Ch 6 Supply Chain Management Managing the Supply Chain Key to matching demand with supply Managing materials waiting time Cost and Benefits of inventory Inventory Analysis: Economies of Scale (Ch 6) Palu Gear: Inventory management of a retailer: EOQ + ROP Levers for improvement Copyright © 2013 Pearson Education Inc. publishing as Prentice Hall 1 Key Financial Indicators of Supply Chain Performance Return on Assets Net Present Value … …
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