When a firm makes a long-term capacity decision, selecting the base case alternative means doing nothing and losing orders from any demand that exceeds current capacity, or incurring costs due to excess capacity.

Question

Quizplus · Accepted Answer

Selecting the base case alternative in long-term capacity decisions typically means maintaining the status quo, which can result in lost orders if demand exceeds current capacity or incurring costs from excess capacity if demand is lower than expected.

When a Firm Makes a Long-Term Capacity Decision, Selecting the Base