capacity utilisation Flashcards
1
Q
capacity utilisation
A
the use that a business makes of it’s resources
2
Q
how is it calculated
A
current output/maximum x 100
3
Q
reasons to under utilise
A
decrease of demand
increased competition
seasonal demand
4
Q
problems with under utilising
A
unit costs aren’t minimized
lowers motivation
5
Q
benefits of under utilising
A
can cater to increase in demand
less work related stress
6
Q
drawbacks of over utilisation
A
machines may be overworked
workers may be overworked
not able to respond to increase in demand
insufficient time for training and maintenance
7
Q
benefits of over utilization
A
lower average costs
higher staff motivation
