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Exam 4: Strategic Capacity Management

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Question 21

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The larger the capacity cushion the better.

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Question 22

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A production facility works best when it focuses on a fairly limited set of production objectives.

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Question 23

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Capacity planning involving acquisition or disposal of fixed assets such as buildings, equipment or facilities is considered as which one of the following planning horizons?

The objective of strategic capacity planning is to determine the overall capacity level of capital intensive resources (including facilities, equipment, and overall labor force size) that best supports the company's long-range competitive strategy.

Capacity flexibility means having the ability to rapidly increase or decrease production levels, or to shift production capacity quickly from one product or service to another.

A capacity cushion is the amount of capacity less than expected demand.

Which of the following is not a step used in determining production capacity requirements?

In solving a decision tree problem, calculations start at the ends of the "branches" of the tree and work backwards to the base of the tree.

The capacity cushion is the ratio of capacity used to the best capacity level.

In designing a general service facility, capacity should be such that the target rate of service utilization (ρ) , in order to get the best general-purpose design, should be

The objective of strategic capacity planning is to provide an approach for determining the overall capacity level of labor-intensive resources.

A production facility develops virtuosity and works best when it focused on a widely varied set of production objectives.

Precise capacity design or the rate of service utilization (ρ) , is application specific.

When deciding to add capacity to a factory which of the following need not be considered?

At a decision point in a decision tree, which machine would you select when trying to maximize payoff when the anticipated benefit of selecting machine A is $45,000 with a probability of 90%; the expected benefit of selecting machine B is $80,000 with a probability of 50% and the expected benefit of selecting machine C is $60,000 with a probability of 75%?

What is an important difference between capacity planning in services as contrasted to capacity planning in manufacturing operations?

In practice achieving a perfectly balanced plant is usually both impossible and undesirable.

Capacity planning is generally viewed in three time durations: Immediate, Intermediate, and Indeterminate.

At some point, the size of a growing plant can become too large and diseconomies of scale becomes a capacity planning problem.

Capacity planning that involves hiring, layoffs, some new tooling, minor equipment purchases, and subcontracting is considered as which one of the following planning horizons?