The frequency of additions to productive capacity should balance the costs of upgrading too frequently and the costs of upgrading too infrequently.

Question

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If a company upgrades its productive capacity too frequently, it can incur high costs for equipment, training, and integration. On the other hand, if it upgrades too infrequently, it can miss out on new technology and fall behind competitors. Therefore, finding the right frequency of upgrades is essential to balance these costs and maintain a competitive advantage.

The Frequency of Additions to Productive Capacity Should Balance the Costs