Final answer:
If cycle time equals takt time, each worker's capacity utilization is 100%, indicating full utilization matching customer demand. The labor cost can be determined by multiplying the number of workers by the hourly rate, which in this case is $10 per hour.
Step-by-step explanation:
When we assume cycle time equals takt time, it implies that the time it takes to complete one unit of production (cycle time) is the same as the time dictated by customer demand (takt time). Given this scenario, each worker's capacity utilization would be 100%, because they are producing at a rate that exactly matches customer demand, without any excess capacity or time.
If widget workers are paid $10 per hour, then by multiplying the number of workers required to meet each output level by this hourly rate, you can calculate the labor cost for different production levels. However, if cycle time equals takt time, meaning no idle or overtime, the cost would be consistent with the standard output rate. This implies an efficient process with optimized capacity utilization and labor cost.