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DedPeter [7]
3 years ago
9

A process currently services an average of 43 customers per day. Observations in recent weeks show that its utilization is about

90​ percent, allowing for just a 10 percent capacity cushion. If demand is expected to be 70 percent of the current level in five years and management wants to have a capacity cushion of just 8 ​percent, what capacity requirement should be​ planned?
Business
1 answer:
love history [14]3 years ago
6 0

Answer:

The correct answer is 31 customers per day.

Explanation:

Consider the current capacity requirement as = x

Management wants to have a capacity cushion = 8%.

So the utilization is required = 100% - 8% = 92%

A process of currently services an average of 43 customers per day and utilization is 90%.

Expected Demand=70%= 70 ÷ 100 = 0.70

Current utilization = 90% = 0.90

Let Capacity requirement = X

Capacity requirement ÷ required utilization  = Expected Demand rate × current service rate ÷ current utilization rate

X ÷ 0.92  = 0.70 × 43 ÷ 0.90

X = 0.70 × 43 ÷ 0.90 × 0.92

= 30.76  or 31

Needed capacity requirement is 31 customer per day.

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