Capacity decisions are usually linked with other decision areas.If a system is well balanced,which one of the following changes requires a larger-capacity cushion?
A) Yield losses in the production process are reduced.
B) Schedules for production are more stable.
C) The capital intensity of the process is increased.
D) The company promises faster delivery times to customers.

Question

Quizplus · Accepted Answer

If a company promises faster delivery times to customers, it requires a larger-capacity cushion to ensure it can meet the promised delivery times, while also handling any unexpected changes or increases in demand. The other options (reducing yield losses, stable production schedules, and increasing capital intensity) all contribute to a more efficient and predictable system, which can help reduce the need for a large capacity cushion.

Capacity Decisions Are Usually Linked with Other Decision Areas