A wait-and-see strategy in regard to capacity is best characterized by
A) reducing the risks of over optimistic demand forecasts.
B) using capacity as a competitive weapon in order to compete on cost.
C) reducing the risks of lost sales due to capacity constraints.
D) making large, infrequent jumps in capacity expansions.

Question

Quizplus · Accepted Answer

A wait-and-see strategy involves being cautious in adding capacity and waiting to see how demand develops. This strategy can reduce the risks of overestimating demand and investing in excess capacity, which can be costly. Therefore, reducing the risks of over optimistic demand forecasts is the best characterization of a wait-and-see strategy. The other options do not accurately describe this strategy.

A Wait-And-See Strategy in Regard to Capacity Is Best Characterized