Group 6

Joven, Catarugan

Liban, Jero

Marx Amiel, Pinpin

Capacity Planning Questions and Answer

1) What is Capacity Planning?
Answer: Process of determining the production capacity needed.
2) What is the importance of capacity planning to a manager?
Answer: It Ensures availability to work on it.
Impact the ability to meet future demands.
Helps to identify easily any skill gap.
Helps you to manage your skills inventory.
Capacity influences the operating costs.
It results in long-term commitment of funds.
3) Names of the three types of Measuring System Effectiveness?
Answer: Design Capacity, Effective Capacity and Actual Output.
4) What are the different of the types of Measuring System Effectiveness?
Answer: Design Capacity - The maximum theoretical output of a system.
Effective Capacity - Expects to achieve given current operating constraints.
Actual output - It is rate of output actually achieved.
5) What is the formula of Efficiency?
Answer: Efficiency = Actual output (Measured as percentages)
Effective Capacity
6) What is the formula of Utilization?
Answer: Utilization = Actual Output (Measured as percentages)
Design Capacity
7) What are the factors of Determinant of Effective Capacity?
Answer: Facilities
Product and service factors
Process factors
Human factors
Policy factors
Operational factors
Supply chain factors
External factors
8) What are Amount of Capacity Needed, Timing of changes, Extent of flexibility of
facilities and Need to maintain balance.?
Answer: The 4 Keys of Decision of Capacity Need
9) The Capacity and location are closely tied, Inability to store services, capacity must be
matched with timing of demand, degree of volatility of demand, peak demand periods
and Capacity must be matched with timing of demand?
Answer: Role of Planning Service Capacity
10) Approach to capacity changes, prepare to deal with capacity, attempt to smooth out
capacity requirements and Identify the optimal operating level?
Answer: The role of Developing Capacity Alternatives
11) What is the greater the quantity of output produced, the lower the per-unit fixed
cost?
Answer: Economies Rate of Scale
12) What is Output rate is more than the optimal level, increasing the output rate results
in increasing average unit costs?
Answer: Diseconomies scale
13) What is Output rate is less than the optimal level, increasing output rate results in
decreasing average unit costs?
Answer: Economies of scale
14) The minimum cost must be average cost per unit, above the rate of output?
Answer: Optimal Rate of Output
15) The unit cost is falling as output increase from Q1 to Q2 is economies of scale, Unit
start to rise as output rise as above?
Answer: Economies of Scale