You are in charge of a large assembly shop that specializes in contract assignments.
One of your customers has promised to award you a large contract for the assembly of 25 units of a new product. The suggested bid price in the contract is based on an average of 30hours of direct labour per unit.
You conduct a couple of test assemblies and find that, although the first unit took 50 hours, the second unitcould be completed in just 45 hours.
Suppose the workers can supply 1607 labour-hours each year to the assembly of the product. For the first year, what is the firm’s annual “capacity” to assemble the product? That is, how many units can the firm assemble in the first year?