4. A manufacturing shop is designed to operate most efficiently at an output of 550

units per day. In the past month the plant produced 490 units. What was their

capacity utilization rate last month?

5. A company has a factory that is designed so that it is most efficient (average unit

cost is minimized) when producing 15,000 units of output each month. However, it has

an absolute maximum output capability of 17,250 units per month, and can produce as

little as 7000 units per month without corporate headquarters shifting production to

another plant. If the factory produces 10,925 units in October, what is the capacity

utilization rate in October for this factory?