An Expansionist Capacity Strategy

question 119

Multiple Choice

An expansionist capacity strategy:

• A) lags behind demand.
• B) reduces the risk of overexpansion based on overly optimistic demand forecasts.
• C) can preempt expansion by competitors by announcing a large capacity expansion.
• D) meets capacity shortfalls with overtime, temporary workers, subcontracting, and stockouts.

---

Definitions:

Excess Cash

The amount of cash available exceeding what is necessary for day-to-day operations, often allocated for investment or returned to shareholders.

Business Relationships

The connections and interactions between a company and its customers, suppliers, partners, and other entities essential for its operation.

Brokerage Fees

Charges levied by a broker for executing transactions or providing specialized services.

Common Stock

A type of security that signifies ownership in a corporation, entitling the holder to a claim on part of the company's profits and assets.