A company has estimated its effective capacity is 1,000 units produced per day. If the company wishes to maintain a capacity utilization of at least 95%, what must its actual output be?
A) 1,000 units per day
B) 1,150 units per day
C) 950 units per day
D) Impossible to determine from the information provided

Question

Quizplus · Accepted Answer

To maintain a capacity utilization of at least 95%, the actual output must be at least 95% of the effective capacity. 95% of 1,000 units is 950 units per day.

A Company Has Estimated Its Effective Capacity Is 1,000 Units