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Ch. 5 Capacity Planning for Products and Services

# Ch. 5 Capacity Planning for Products and Services - Chapter...

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Chapter 05 - Strategic Capacity Planning for products and services CH. 5 STRATEGIC CAPACITY PLANNING FOR PRODUCTS AND SERVICES Problem 1 a. % 70 10 7 capacity Design output Actual n Utilizatio = = = % 5 . 87 8 7 capacity Effective output Actual Efficiency = = = b. % 67 6 4 capacity Design output Actual n Utilizatio = = = % 80 5 4 capacity Effective output Actual Efficiency = = = c. This is not necessarily true. If the design capacity is relatively high, the utilization could be low even though the efficiency was high. Problem 2 Given : Actual output = .8 (Effective capacity) Effective capacity = .5 (Design capacity) Therefore Actual output = (.5)(.8)(Design capacity) i.e. Actual output = (.4)(Design capacity) capacity Design output Actual = n Utilizatio = (0.4) (Design Capacity) / (Design Capacity) = 0.4 - Design Capacity = (Actual Output) / (Utilization) = 8 / 0.4 = 20 5-1

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Chapter 05 - Strategic Capacity Planning for products and services Problem 3 FC = \$9,200/month VC = \$ .70/unit Rev = \$ .90/unit a. units VC FC Q BEP 000 , 46 70 \$. 90 \$.
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Ch. 5 Capacity Planning for Products and Services - Chapter...

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