Level capacity strategy vs chase demand strategy 182695
Assume 0 units of initial inventory Extra capacity may be obtained by subcontracting at an additional cost of $15 per unit over and above the company's producing them itself on regular time Provide a detailed cost breakdown for using a level vs a chase strategy to meet the increased demand Which strategy do you recommend? Chase demand strategy can be defined as a strategy where the changes are made to the output according to the demand Here, the changes are in terms of increasing or decreasing the output in line with the rising or falling demand It involves matching the demand by hiring or firing the workers or by controlling the level of production and usingCapacity is the maximum amount of work an accounting practice is capable of completing in a given period of time Capacity planning is the process of determining the resources (time, people, etc) that the firm needs to meet changing demands for its services – in other words, how it will meet its current and future client needs ...
