Liberty University BUSI 411 Operations Management Final Exam 2. Questions & Answers

Liberty University BUSI 411 Operations
Management Final Exam 2. Questions &
Answers

, Liberty University BUSI 411 Operations Management Final
Exam 2. Questions & Answers (Graded A)
NB: EVERY ANSWER IS CORRECT

Question 1
Which of the following is a key question in capacity planning?
Answer When do we need the capacity?
:



Question 2

Utilization is defined as the ratio of:
Answer Actual output to design capacity.
:



Question 3

Given the following information, what would utilization be?

Effective capacity = 20 units per day
Design capacity = 60 units per day
Actual output = 15 units per day
Answer 25%
:


Question 4

An alternative will have fixed costs of $10,000 per month, variable costs of $50 per unit, and revenue of
$70 per unit. The break-even point volume is:
Answer 500.
:


Question 5

A Virginia county is considering whether to pay $50,000 per year to lease a prisoner transfer facility in a
prime location near Washington, D.C. They estimate it will cost $50 per prisoner to process the
paperwork at this new location. The county is paid a $75 commission for each new prisoner they
process. How many prisoners would they have to process annually to break even at this new location?