Exam 6: Managing Capacity

Virtual supply chains have the advantage of efficiency,but this advantage is gained in a trade-off with decreased flexibility.

A firm is able to meet current demand.If it adopts a lead capacity strategy,then it is probably making the assumption that demand will increase in the future.

Capacity is the capability of a worker,machine,work center,plant,or organization to produce output per time period.

Jimbo Elrod has obtained fixed and variable cost information for four potential locations for his professional wrestling school and summarized it in tabular form below.All values are in dollars. -Jimbo evaluates levels of demand ranging from 100 to 2,500 students per year.Which location has the lowest cost for the greatest range of students throughout this continuum?

A company with fixed costs of $10,000 per month has a target price of $165 for their sole product,a heat shield for masonry fireplaces.What level of output represents their break-even point if their variable cost for producing is $35 per unit?

The first three rooms took a four-person crew a total of 9 hours to paint.If the learning curve rate is 85%,how long will it take them to paint all 20 rooms in stately Wayne manor?

Wally's Filling Station is manned by one capable attendant that can fill your tank and check your tires,oil,and water in 5 minutes.If four customers arrive each hour,and the service and arrival rates are governed by the Poisson distribution,what is the utilization of the attendant?

The ________ capacity strategy attempts to adjust the current capacity to a level equivalent to the current demand.

A ninety percent learning curve is steeper than an eighty percent learning curve.

A steady stream of eager fresh-faced students waits in line to register for spring semester classes.Students arrive at the rate of 100 per hour and it takes the registrar 30 seconds to check their schedule and verify they have paid in full.What is the average time waiting in line and the average number of people in line? How busy is the registrar?

An example of a variable cost is:

The relationship between the number of units within system boundaries and the time they spend within the system on average is formalized in ________.

A subdivision is planned for forty houses,each with its own in-ground swimming pool.A contractor estimates it will take him 30 hours to build the first pool and that there is a 90% learning curve associated with this process. -How long will it take to build all of the pools?

Consider the system composed of four processes linked by a conveyor belt.There is no storage between these processes pictured below.Which statement is BEST

The maximum output capability of a system,allowing for no adjustments for scheduled or unscheduled maintenance is the ________.

In operations and supply chain environments that must deal with random demand,it is virtually impossible to achieve very high capacity utilization levels and still provide acceptable customer service.

For a given fixed cost and revenue,as the variable cost rises,the break-even point also rises.

The ________ is the output volume level where the firm realizes a $0 net profit.

Describe the three capacity strategies and the advantages of each.

Shoppers flock to the Piggly Wiggly on payday to stretch their food dollars as far as they can go.Customers enter at the rate of 50 customers per hour and spend an average of 30 minutes selecting their groceries.When it comes time to check out,shoppers have their choice of two types of checkout lines;an express line for shoppers with 20 items or fewer and a single line for shoppers regardless of how many items are in their cart.(It is important to note that this one non-express line feeds multiple checkers - when one customer is done,the next person in the non-express line simply moves to the open register. )About 25% of all shoppers can (and do)choose the express line.There are on average three shoppers in the express line and six shoppers in the non-express line.Once it is their turn,it takes express checkout shoppers an average of two minutes to check out and non-express customers an average of five minutes to check out. -How many customers are in the Piggly Wiggly at any given time?