EBTM 365
Bottleneck operation - Answer-An operation that limits output in the production sequence
Economies of scale - Answer-If the output rate is less than the optimal level, increasing output rate results in decreasing average unit costs
Impacts of capacity decisions - Answer-impacts ab...
EBTM 365
Bottleneck operation - Answer-An operation that limits output in the production
sequence
Economies of scale - Answer-If the output rate is less than the optimal level,
increasing output rate results in decreasing average unit costs
Impacts of capacity decisions - Answer-impacts ability to meet future demands and
long range planning
Capacity planning - Answer-the upper limit or ceiling on the load that an operating
unit can handle
Demand exceeds capacity - Answer-restricts demand by raising prices, scheduling
longer lead time
capacity exceeds demand - Answer-stimulate market and product changes
adjusting to seasonal demand - Answer-produce products with complementary
demand patterns
theory of constraints - Answer-five step process for recognizing and managing
limitations
effective capacity - Answer-the capacity a firm expects to achieve given current
operating constraints
design capacity - Answer-the maximum theoretical output of a system (normally
expressed as a rate)
efficiency - Answer-the percent of effective capacity achieved
utilization - Answer-the percent of design capacity achieved
key success factors - Answer-a created list developed of factors relevant to the
situation
globalization and location decisions - Answer-region/community decision and site
decision
labor productivity - Answer-lower productivity may increase total cost
cross-docking - Answer-materials are moved directly from receiving to shipping and
are not placed in storage in the warehouse
cycle time - Answer-the maximum time allowed at each workstation to complete its
set of tasks on a unit
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