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Chapter 1: Q. 5-6PE (page 128)

We have this when we have the ability to serve more customers than we expect to have to serve.

Short Answer

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Capacity cushion

Step by step solution

01

Capacity cushion

When the degree of additional capacity is added to the farming organization to maintain rapid increases in demand or unexpected reductions of manufacturing capacity is referred to as acapacity cushion.

02

Example of capacity cushion

For instance, a 10% capacity cushion exists if a facility's projected monthly demand is $ 400,000 in items or services and it can generate up to $ 450,000.

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Most popular questions from this chapter

A construction project is broken down into the following 10 activities:

Activity

Immediate Predecessor

Time (Weeks)

1

_

4

2

1

2

3

1

4

4

1

3

5

2,3

5

6

3

6

7

4

2

8

5

3

9

6,7

5

10

8,9

7

A criterion that differentiates the products or services of one firm from those of another.

The procedure used to reduce project completion time by trading off time versus cost.

What are some reasons for a plant to maintain a capacity cushion? How about a negative capacity cushion?

What features in project management information systems can be used to resolve the over-allocation of project resources?
See all solutions

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