Capacity and Aggregate Planning Quiz

What is sometimes referred to as rated capacity?

• efficiency

• utilization

• effective capacity

• expected output

Effective capacity is the:

• maximum output of a system in a given period.

• capacity a firm expects to achieve given the current operating constraints

• average output that can be achieved under ideal conditions

• minimum usable capacity of a particular facility.

Which of the following represents an aggressive approach to demand management in the service sector when demand and capacity are not particularly well matched?

• lower resort hotel room prices on Wednesdays

• appointments

• reservations

• first-come, first-served rule

Which of the following represents a common way to manage capacity in the service sector?

• Appointments

• Reservations

• changes in staffing levels

• first-come, first-served service rule

Utilization will always be lower than efficiency because:

• effective capacity is less than design capacity.

• effective capacity is greater than design capacity.

• effective capacity equals design capacity

• expected output is less than actual output.

Adding a complementary product to what is currently being produced is a demand management strategy used when:

• demand exceeds capacity.

• capacity exceeds demand for a product that has stable demand

• the existing product has seasonal or cyclical demand.

• price increases have failed to bring about demand management

Under which of the following do planning tasks associated with job assignments, ordering, job scheduling, and dispatching typically fall?

• short-range plans

• intermediate-range plans

• long-range plans

• mission-related planning

Under which of the following do planning tasks associated with production planning and budgeting, as well as setting employment, inventory, and subcontracting levels, typically fall?

• short-range plans

• intermediate-range plans

• long-range plans

• demand options

Top executives tend to focus their attention on which type of forecasts?

• short-range

• intermediate-range

• long-range

• weather

What is the typical time horizon for aggregate planning?

• less than a month

• up to 3 months

• 3 to 18 months

• over one year