In which of the following situations would you expect MRP to work well? To work poorly? a. A fabrication plant operating at less than 80 percent of capacity with relatively stable demand b. A fabrication plant operating at less than 80 percent of capacity with extremely lumpy demand c. A fabrication plant operating at more than 95 percent of capacity with relatively stable demand d. A fabrication plant operating at more than 95 percent of capacity with extremely lumpy demand e. An assembly plant that uses all purchased parts and highly flexible labor (i.e., so that effective capacity can be adjusted over a wide range) f An assembly plant that uses all purchased parts and fixed labor (i.e., capacity) running at more than 95 percent of capacity

Step by step solution

01

Situation a: Fabrication plant at less than 80% capacity with stable demand

MRP would work well in this situation. The relatively stable demand allows the MRP system to effectively plan material requirements, and the unused capacity provides room for adjustments as needed.

02

Situation b: Fabrication plant at less than 80% capacity with lumpy demand

MRP might not work as well in this situation. The fluctuating, lumpy demand will make it more challenging to plan materials accurately, although the unused capacity might provide some flexibility for materials management.

03

Situation c: Fabrication plant at more than 95% capacity with stable demand

MRP could still work reasonably well in this situation. The high capacity utilization might limit adjustments, but the stable demand would allow the MRP system to accurately plan material requirements.

04

Situation d: Fabrication plant at more than 95% capacity with lumpy demand

MRP would likely work poorly in this situation. The combination of high capacity utilization and lumpy demand would make it difficult for the MRP system to accurately plan material requirements and make adjustments as needed.

05

Situation e: Assembly plant with purchased parts and flexible labor

MRP would work well in this situation. The high flexibility in labor and purchased parts means a more adaptable and responsive manufacturing process. This flexibility would allow the MRP system to effectively plan material requirements and make adjustments as needed.

06

Situation f: Assembly plant with purchased parts and fixed labor at more than 95% capacity

MRP might not work well in this situation. The high capacity utilization and fixed labor limit flexibility in the manufacturing process, making it more challenging for the MRP system to plan material requirements accurately and make adjustments as needed.

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