For each 100 units of product manufactured, a certain processyields 85 conforming units, five that must be scrapped, and 10 thatmust be reprocessed. Each unit scrapped results in a $50 loss; eachreprocessed unit requires an extra half hour of processing time.The resource time of producing the original 100 units is 20hours.
(a)Calculate the scrap cost, reprocessing time, and productivityper hour. Productivity should be calculated in terms of conformingunits per hour of resource input.
(b)A quality improvement program has recently been successfullyintroduced. For each 100 units manufactured, the process now yields95 conforming units, one to be scrapped, and four for reprocessing.Repeat the calculations of paragraph (a). What are the quantitativebenefits of the quality effort to costs, to delivery schedules, andto productivity?
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