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A case study on the balancing and design of a line assembling black‐and‐white television receivers is reported. Task allocations are made using a cost model and considering the relatedness of tasks. The variability of task times, together with variability in the failure rates of the sets, increases in‐process inventory. Consequently, the average time a set spends in the system increases. A model is therefore developed using SLAM‐II to determine the in‐process storage capacity for physical layout. A regression model is also developed for the average time a television spends in the system using the output obtained from the simulation model.

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