Which one of the following statements about capacity cushion is best?
A) A larger cushion increases manufacturing lead time.
B) Businesses find large cushions appropriate when demand varies.
C) A larger cushion increases equipment utilization when capital intensity is high.
D) A larger cushion is required when a firm uses low cost as a competitive priority.

Question

Quizplus · Accepted Answer

A larger capacity cushion is appropriate when demand varies because it allows a business to handle fluctuations in demand without sacrificing service levels or delivery times.

Which One of the Following Statements About Capacity Cushion Is