Part 1What is efficiency?Part 2
A. 100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

Question

Part 1What is​ efficiency?Part 2
A. ​100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

BlackTom AI · Accepted Answer

Consider the concept of efficiency in operations management as a measure comparing what is actually produced to what could be produced under optimal conditions.
Option A: '100% utilization' claims efficiency equals full utilization of all resources. In practice, 100% utilization is rarely achievable and does not reflect how effectively the system converts capacity into actual output, so this is not a correct definition of efficiency.
Option B: 'percentage of design capacity actually used' suggests using design capacity as the baseline. However, efficiency typically uses effective (or available) capacity as the baseline, not the design capacity alone, making this definition incomplete or inaccurate." 
Option C: 'effective capacity divided by design capacity' expresses a ratio of capacities (how much capacity is available versus what was designed), which is a capacity-utilization metric, not efficiency of actual output relative to usable capacity. This confuses capacity potential with actual performance, so it's not the right definition of efficiency.
Option D: 'percentage of effective capacity actually used' aligns with the standard efficiency formula: actual output divided by effective capacity. This captures how well the system converts the available, realistically usable capacity into output, which is the essence of efficiency.

Test:Exam#2

Part 1What is efficiency?Part 2 A. 100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

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