Planning Service Capacity Involves Consideration of the Mean Arrival Rate

question 1

Multiple Choice

Planning service capacity involves consideration of the mean arrival rate and the mean service rate. When the mean arrival rate exceeds or gets too close to the mean service rate the quality of the service declines. The operating point is the ratio of mean service rate to mean arrival rate. According to the text, what is the best operating point for the typical service operation?

• A) 120%
• B) 100%
• C) 90%
• D) 70%
• E) 57%

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Definitions:

Largest Current Asset

Typically refers to the current asset in a company's balance sheet that represents the highest value, commonly either cash or accounts receivable.

Merchandiser

A business or person that sells goods to consumers, typically involved in purchasing, displaying, and selling of products.

Inventory

The total amount of goods and materials held by a company for the purpose of resale or manufacturing.

Gross Profit

The difference between revenue and the cost of goods sold, indicating the efficiency of core operations.