The average lead time of a unit of product through a manufacturing station is 10 minutes. The production rate has been steady at five units per hour. The average work-in-process inventory at this station is:
A) 50 units.
B) 10 units.
C) 5 units.
D) 0.83 units.

Question

Quizplus · Accepted Answer

The average work-in-process inventory is equal to the production rate multiplied by the average lead time. In this case, the production rate is 5 units per hour and the average lead time is 10 minutes, or 1/6 of an hour. Therefore, the average work-in-process inventory is 5 units per hour * 1/6 of an hour = 0.83 units.

The Average Lead Time of a Unit of Product Through