CP-206: PRODUCTION AND OPERATIONS MANAGEMENT Production & Operations Management: Production is the process by which raw materials and other inputs are converted into finished products. The essential feature of production is to bring together people‚ machines and materials to provide goods and services and thereby to satisfy the wants of people. Since both manufacturing and service organizations involve the above-mentioned features‚ the term production management is gradually replaced by the
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Factors of Production Factors of production are resources necessary to produce goods and services. There are four factors of production. The factors of production include natural resources‚ labor‚ capital‚ and entrepreneur. These factors of production are very important to our economy. Firstly‚ natural resources are “gifts of nature” that make production possible. One example of a natural resource is a tree to produce paper. Natural resources include actual surface land and water. They also
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Q1. Of the following production functions‚ which exhibit increasing‚ constant‚ or decreasing returns to scale? a. F(K‚L) = K2 L b. F(K‚L)=10K + 5L c. F(K‚L)= KL.5 Q2. Suppose the process of producing lightweight parkas by Polly’s Parkas is described by the function q=10K8 (L-40).2 Where q is the number of parkas produced‚ K the n umber of computerized stitching-machine hours and L the number of person-hours of labor. In addition to capital and labor‚ $10 worth of raw materials
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Methods of production Production methods fall into three main categories; however‚ all production methods can be assisted with CAM and CAD equipment (Computer Aided Manufacture and Computer Aided Design – respectively). 1. Job Production and Prototype Production Job Production is used when a product is produced with the labor of one or few workers and is scarcely used for bulk and large scale production. It is mainly used for one-off products or prototypes‚ as it is inefficient; however‚ quality
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THE ECONOMICS OF MASS PRODUCTION. The United States economy changed dramatically in the period following the Civil War. Business itself changed during this time: various ways were tried to increase the size of businesses‚ including trusts and holding companies. The average standard of living more than doubled between 1870 and 1910 and manufacturing‚ rather than agriculture‚ became businesses central feature. A major factor in this increase was the rise of big businesses and the widespread use
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Production Cost Analysis and Estimation Applied Problems 1. Jennifer Trucking Company operates a large rig transportation business in Texas that transports locally grown vegetables to San Diego‚ California. The company owns 5 large rigs and hires local drivers paid fixed salaries monthly‚ regardless of the number of trips or tons of cargo that each driver transports each month. The below table presents details about the number of drivers and the total cargo transported by the company at different
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3.2 PRODUCTION FUNCTION OR INPUT-OUTPUT RELATIONSHIP SHORT RUN AND LONG RUN PRODUCTION FUNCTION Production function may be defined as the functional relationship between physical inputs that’s factors of production (land‚ labour etc) and physical outputs that is quantity of goods produced. Thus the production function expresses the relationship between quantity of output and the quantities of various inputs used in production. The physical relationship between a firm’s physical input and output
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Consumer Expenditure and Equi-marginal Utility Consumer behaviour theory tries to explain the relationship between price changes and consumer demand. Utility is a concept used to denote the subjective satisfaction or usefulness attained from consuming goods and services. This concept helps to explain how consumers divide their limited income / resources among different choices of goods and services that help attain them satisfaction (utility) The issue however is how we are supposed to measure
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FACTORS OF PRODUCTION In economics‚ factors of production are the inputs to the production process. Finished goods are the output. Input determines the quantity of output i.e. output depends upon input. Input is the starting point and output is the end point of production process and such input-output relationship is called a production function. ’Factors of production’ may also refer specifically to the ’primary factors’‚ which are stocks including land‚ labor (the ability to work)‚ and capital
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Mass production refers to the making of large quantities of standardized products. The process involves division of labour and each worker specializes in one or two tasks‚ doing repetitive work. On the other hand‚ the craftsman is the expert who is solely responsible for all the steps involved in producing the product. There is assumption that the craftsman is the master who has skill‚ and expertise to ensure that all his products are of a good quality. Whether mass production will inevitably lead
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