OPERATIONS MANAGEMENT CHAPTER
11 ACCURATE QUESTIONS AND
ANSWERS WITH SOLUTIONS 2024
What is capacity? - ANSWER In a physical sense, means scale of operation, but must also incorporate a
time dimension appropriate to asset usage
What are the objectives of capacity planning and control? - ANSWER To provide an 'appropriate' amount
of capacity at any point in time
What is the capacity planning judged on? - ANSWER It's effects on costs, revenues, working capital,
service level
What are the steps in capacity planning and control? - ANSWER 1. Measure aggregate demand/capacity
2. Understand change effects
3. Determine the operation's base level of capacity
4. Identify/select methods of coping with mismatches between demand/capacity
5. Understand the consequences of different capacity decisions
What are the broad causes of seasonality? - ANSWER Climate, festive, behavioral, political, financial,
social
True or false: forecasts are essential for effective capacity planning? - ANSWER True coupled with
understanding demand uncertainty allows you to judge risks to service level
What happens when demand uncertainty is high? - ANSWER The risks to service level of under provision
of capacity are high
Define design capacity: - ANSWER The capacity of a process or facility as it is designed to be (greater
than effective capacity)
11 ACCURATE QUESTIONS AND
ANSWERS WITH SOLUTIONS 2024
What is capacity? - ANSWER In a physical sense, means scale of operation, but must also incorporate a
time dimension appropriate to asset usage
What are the objectives of capacity planning and control? - ANSWER To provide an 'appropriate' amount
of capacity at any point in time
What is the capacity planning judged on? - ANSWER It's effects on costs, revenues, working capital,
service level
What are the steps in capacity planning and control? - ANSWER 1. Measure aggregate demand/capacity
2. Understand change effects
3. Determine the operation's base level of capacity
4. Identify/select methods of coping with mismatches between demand/capacity
5. Understand the consequences of different capacity decisions
What are the broad causes of seasonality? - ANSWER Climate, festive, behavioral, political, financial,
social
True or false: forecasts are essential for effective capacity planning? - ANSWER True coupled with
understanding demand uncertainty allows you to judge risks to service level
What happens when demand uncertainty is high? - ANSWER The risks to service level of under provision
of capacity are high
Define design capacity: - ANSWER The capacity of a process or facility as it is designed to be (greater
than effective capacity)
