Solution Manual of Operations and Supply Chain Management 14 Edition Jacobs

1.

Capacity can be defined as the ability to hold, receive, store, or accommodate. 
 
True    False

2.

When evaluating capacity, managers need to consider both resource inputs and product outputs. 
 
True    False

3.

Capacity can be defined as the amount of available resource inputs relative to requirements for output over a particular period of time. 
 
True    False

4.

The capacity utilization rate is found by dividing best operating level by capacity used. 
 
True    False

5.

The objective of strategic capacity planning is to provide an approach for determining the overall capacity level of labor-intensive resources. 
 
True    False

6.

The objective of strategic capacity planning is to determine the overall capacity level of capital intensive resources (including facilities, equipment, and overall labor force size) that best supports the company’s short-range competitive strategy. 
 
True    False

7.

The objective of strategic capacity planning is to determine the overall capacity level of capital intensive resources (including facilities, equipment, and overall labor force size) that best supports the company’s long-range competitive strategy. 
 
True    False

8.

Best operating level is usually a multiple of the level of capacity for which a process was designed. 
 
True    False

9.

Best operating level is the volume of output at which average unit cost is minimized. 
 
True    False

10.

At some point, the size of a growing plant can become too large and diseconomies of scale become a capacity planning problem. 
 
True    False

11.

Long-range capacity planning requires top management participation. 
 
True    False

12.

Overtime and personnel transfers are solutions to capacity problems in the intermediate term. 
 
True    False

13.

Capacity planning is generally viewed in three time durations: immediate, intermediate, and indeterminate. 
 
True    False

14.

The basic notion of economies of scale is that as a plant gets larger and volume increases, the average cost per unit of output drops. 
 
True    False

15.

A piece of equipment with twice the capacity of another piece typically costs twice as much to purchase and to operate. 
 
True    False

16.

The problem of keeping demand sufficiently high to keep a large factory busy is a sales issue and not a diseconomy of scale. 
 
True    False

17.

A production facility works best when it focuses on a fairly limited set of production objectives. 
 
True    False