QUESTION 4 a. Differentiate between design capacity and capacity utilization. b. Briefly describe three capacity expansion strategies. \
Breakeven Analysis
Break Even Analysis is a term used in business, cost accounting and economics. It refers to a point where the total cost incurred becomes equal to the total revenue earned. Break Even Analysis determines the number of units to be sold to earn the revenue required to cover the total costs. Total cost is a sum total of fixed and variable costs.
Process analysis
The term process analysis can be defined as breakdown of production process into different phases that converts inputs into output. A series of routine activities are incorporated using organizational resources with a view to achieve operational excellence.
QUESTION 4
a. Differentiate between design capacity and capacity utilization.
b. Briefly describe three capacity expansion strategies. \
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