Final answer:
The actual cycle time needed for production to meet forecasted demand is calculated by finding the optimal mix of labor and machinery to minimize costs while fulfilling production goals, based on the chosen lowest-cost production technology.
Step-by-step explanation:
To determine the actual cycle time required for production to meet forecasted demand, we need to assess the production process's efficiency, labor and machine costs, and the forecast demand itself. Considering the provided scenario, the firm has various production technologies, and it has been suggested that production technology 3 should be selected due to its lowest total cost. This decision is influenced by the cost dynamics of machine hours to labor. If machine hours are cheaper, it is financially sensible to leverage machinery over labor. With an increased demand for 15 documents per day, the firm may look into acquiring more PCs to optimize the production process. Similarly, the firm must balance labor hours and the cost of machinery when, for example, the cost of labor increases due to union negotiations. Determining the ideal cycle time will involve calculating the optimal mix of labor and machinery to minimize costs while satisfying the increased document production requirement.