WorksheetsDDWJ3193 CAPACITY PLANNING
Total questions: 10
Worksheet time: 2hrs 0mins
Effective capacity is the
maximum output of a system in a given period
capacity a firm expects to achieve given the current operating constraints.
average output that can be achieved under ideal conditions.
minimum usable capacity of a particular facility.
Effective capacity × Efficiency equals
efficient capacity.
utilization.
actual capacity.
expected output.
Break-even is the number of units at which:
total revenue equals total variable cost.
total revenue equals total fixed cost.
total profit equals total cost.
total revenue equals total cost.
Which of the following costs would be incurred even if no units were produced?
raw material costs
direct labor costs
transportation costs
building rental costs
Which of the following statements regarding fixed costs is TRUE?
Fixed costs rise by a constant amount for every added unit of volume.
While fixed costs are ordinarily constant with respect to volume, they can "step" upward if volume increases result in additional fixed costs.
Fixed costs are those costs associated with direct labor and materials.
Fixed costs equal variable costs at the break-even point.
The Academic Computing Center has five trainers available in its computer labs to provide training sessions to students. Assume that the design capacity of the system is 1900 students per semester and that effective capacity equals 90% of design capacity. If the number of students who actually got their orientation session is 1500, what is the utilization of the system?
1350 students
1710 students
78.9%
87.7%
Christopher's Cranks uses a machine that can produce 100 cranks per hour. The firm operates 12 hours per day, five days per week. Due to regularly scheduled preventive maintenance, the firm expects the machine to be running during approximately 95% of the available time. Based on experience with other products, the firm expects to achieve an efficiency level for the cranks of 75%. What is the expected weekly output of cranks for this company?
5700
4845
8421
4275
Fabricators, Inc. wants to increase capacity by adding a new machine. The fixed costs for machine A are $90,000, and its variable cost is $15 per unit. The revenue is $23 per unit. What is the break-even point for machine A?
$90,000
11,250 units
$11,250
15,000 units
The staff training center at a large regional hospital provides training sessions in CPR to all employees. Assume that the capacity of this training system was designed to be 1200 employees per year. Since the training center was first put into use, the program has become more complex, so that 950 now represents the most employees that can be trained per year. In the past year, 850 employees were trained. The efficiency of this system is approximately ________ and its utilization is approximately ________.
90.5% ; 79.2%
87.5% ; 950 employees
79.2% ; 90.5%
89.5% ; 70.8%
Which of the following represents a common way to manage capacity in the service sector?
appointments
reservations
changes in staffing levels
"early bird" specials in restaurants
