Which one of the following statements about measuring capacity is best?
A) The utilization rate is expressed as the ratio of average output rate to either peak capacity or effective capacity.
B) Output measures are the usual choice for flexible flow processes.
C) Input measures are the usual choice of firms like Nissan Motor Company at its Tennessee plant.
D) The maximum output rate for a restaurant would be the number of seats.

Question

Quizplus · Accepted Answer

The utilization rate is a commonly used measure of capacity and is expressed as the ratio of average output rate to either peak capacity or effective capacity. This takes into account both the maximum potential capacity and the actual output of the system. Option B is incorrect as input measures are usually the choice for flexible flow processes, not output measures. Option C is incorrect as Nissan Motor Company is an example of a firm that uses input measures, but this is not necessarily the usual choice for all firms. Option D is incorrect as the maximum output rate for a restaurant would depend on factors such as the number of tables, kitchen capacity, and staff availability, not just the number of seats.

Which One of the Following Statements About Measuring Capacity Is