Chapter 05 Strategic Capacity Planning for Products and Services

81. If this new blood analysis machine has design and effective capacities of 6,000 and 5,000 blood analyses per year, respectively, and Dr. J. expects to perform 4,500 HIV blood analyses each year, what will be the utilization of this machine?
A. 0%
B. 75%
C. 83%
D. 90%
E. 100%

82. If this new blood analysis machine has design and effective capacities of 6,000 and 5,000 blood analyses per year, respectively, and Dr. J. expects to be 80% efficient in his use of this machine, how many HIV blood analyses does he plan to perform each year?
A. 3,200
B. 4,800
C. 4,000
D. 1,000
E. 5,000

Essay Questions

Given the following data for a make or buy decision:

83. What are total costs to buy a quantity of 15,000 units per year?

84. What are total costs to make a quantity of 15,000 units per year?

85. For what quantity would you be indifferent between buying or making?

86. For what range of output would you prefer to buy?

87. For what range of output would you prefer to make?

88. Which alternative would you select for a quantity of 24,000 units per year?

89. What would be your total costs for the preferred alternative, for 32,000 units per year?

90. What would be your cost savings for the preferred alternative, for 32,000 units per year, compared to the other alternative?