production and cost curve :: essays research papers

Production/Cost Curves either company has some mental of Revenue and they all have costs that are associated with running the company. It is as well true that if a company wants to sum up their Revenue, their costs will outgrowth too. It is every companys goal to gunkimize revenue and each through Production or Services, and minimize cost. These things are easy to find out out, that actually identifying the production and figuring out how it will increase or decrease with change is very difficult.In Fred Meyer our output akin in all grocery stores, is not a product but the amount of items we sell. Sales is what drives the company, it is the source for our Revenue. Similar to manufacturing companies where they have numbers that ordain them how much they produced, we have numbers that tells us how much we have sold. Every department has a goal that they have to reach. They have to sell their products to come about to that number. The number varies daily, and managers expe ct from every department that they will sell more(prenominal)(prenominal) products compared to last year. For departments to achieve that, managers have to look at the output aim and decide how they can increase profit. It will be very difficult for them to do that because if they want to increase the production/output which is sales in my situation, they would incur costs. So if managers decide to try and sell more products, they could study more employees to persuade customers to buy more products. We can see that when we go to Circuit City and Best Buy, they have employees just stand up slightly and not doing anything, but once a customer shows up, they are all over them. So for managers in my Home-electronic department they could h resentment more employees to sell more products. That concept would not be very competent after a certain number of employees are hired. If we h ire 10 more employee, than a lot of them would just stand around and be in the way of customers and even each other. This situation could be a bottleneck for people that are trying to get something done. graph A could best describe this example. This graph shows you what happens to the output when more restriction is added. The output will slowly level off and then blow up to decline. If the managers want to maximize the output they would have to look at the max point on the graph to get the highest output with the lowest tote force.