Precise Capacity Design or the Rate of Service Utilization (ρ)

question 29

Multiple Choice

Precise capacity design or the rate of service utilization (ρ) , is application specific.

• A)It could be close to 100% for a sports arena.
• B)It could be as low as 0.5 for hospital emergency room.
• C)As the degree of uncertainty in demand increases, higher ρ may be appropriate.
• D)A, B and C are correct.
• E)Only A and B are correct.

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Definitions:

Merchandise Returns

Goods returned by the buyer to the seller, often due to defects, dissatisfaction, or other reasons, leading to a reversal of the sale.

Cash Realizable Value

The net amount of cash expected to be received from receivables, after adjusting for any allowances for doubtful accounts.

Receivables

Money owed to a company by its customers or other parties, typically from sales on credit, expected to be collected in the future.

Accrue Finance Charges

The process of adding interest or finance charges to the amount owed by a borrower over time, based on the agreement's terms.