Question

A TV repair service company has a seasonal demand for its service,and there is a general shortage of skilled TV repair persons.Which one of the following is a capacity production planning alternative suitable for this situation?

A) Hire and lay off workers to match the demand requirements.
B) Increase the backlog for short-term demand surges.
C) Offer reduced prices during the slack season.
D) Build anticipation inventories.

Answer 1

Answer: increase the backlog for short term demand surges

Explanation:

Since the TV repair service company has a seasonal demand for its service,and there is a general shortage of skilled TV repair persons, the capacity production planning alternative that's suitable for this situation will be to increase the backlog for short-term demand surges.

Offering reduced prices during the slack season isn't appropriate as this will lead to a reduction in revenue. Building anticipation inventories is also wrong as there may be differences in the forecast made.

The correct option is B.