Chapter 9
Capacity Planning and Facility Location
Problems
1.
Joe’s Tasty Burger has determined that its production facility has a design capacity of 400 hamburgers
per day. The effective capacity, however, is 250 hamburgers per day. Lately Joe has noticed that output
has been 300 hamburgers per day. Compute both design and effective capacity utilization measures.
What can you conclude?
2.
A manufacturer of printed circuit boards has a design capacity of 1,000 boards per day. The effective
capacity, however, is 700 boards per day. Recently, the production facility has been producing 950
boards per day. Compute the design and effective capacity utilization measures. What do they tell you?
3.
Beth’s Bakery can comfortably produce 60 brownies in one day. If Beth takes some unusual measures,
such as hiring her two aunts to help in the kitchen and work overtime, she can produce up to 100
brownies in one day.
a)
What are the design and effective capacities for Beth’s Bakery?
b)
If Beth is currently producing 64 brownies, compute the capacity utilization for both measures. What
can you conclude?
4.
The town barber shop can accommodate 35 customers per day. The manager has determined that if two
additional barbers are hired, the shop can accommodate 80 customers per day. What are the design and
effective capacities for the barber shop?
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5.
The design and effective capacities for a local paper manufacturer are 1000 and 600 pounds of paper per
day, respectively. At present, the manufacturer is producing 500 pounds per day. Computer the capacity
utilization for both measures. What can you conclude?
6.
The design and effective capacities for a local emergency facility are 300 and 260 patients per day,
respectively. Currently, the emergency room processes 250 patients per day. What can you conclude
from these figures?
7.
The SteinerWallace Corporation has determined that it needs to expand in order to accommodate
growing demand for its laptop computers. The decision has come down to either expanding now with a
large facility, incurring additional costs and taking the risk that the demand will not materialize, or
expanding small, knowing that in three years management will need to reconsider the question.
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 Spring '08
 CURTHURDS
 Management, Capacity utilization, high demand, small expansion

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