question strategy decision

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In what ways does corporate strategy affect capacity decisions?

The ABC Cement Corporation produces a high-quality cement that is supplied to construction companies. The potential demand and the probability of each potential demand quantity are given for the upcoming year: 

  

Demand in Tons


Probability

 

500,000


0.3

 

250,000


0.4

 

300,000


0.3

Assuming manufacturing capacity of 700,000 tons,  what is the estimated capacity cushion ?

And

Describe the most important questions to be answered concerning facilities decisions.  Apply the questions to a fast-food restaurant chain with expanding demand.

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