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For the theory of constraints, which of the following determines the production rate of the plant? a. Local efficiency measures that encourage production of excess inventory just in case demand is greater than expected b. The economic order quantity c. Market demand d. The drummer constraint’s production rate

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Cornerstones of Cost Management (C...

4th Edition
Don R. Hansen + 1 other
Publisher: Cengage Learning
ISBN: 9781305970663

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BuyFindarrow_forward

Cornerstones of Cost Management (C...

4th Edition
Don R. Hansen + 1 other
Publisher: Cengage Learning
ISBN: 9781305970663
Chapter 20, Problem 21E
Textbook Problem
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For the theory of constraints, which of the following determines the production rate of the plant?

  1. a. Local efficiency measures that encourage production of excess inventory just in case demand is greater than expected
  2. b. The economic order quantity
  3. c. Market demand
  4. d. The drummer constraint’s production rate

To determine

Identify the option which is correct for the given statement.

Explanation of Solution

Theory of constraint: Making money in the future by managing constraints is the main goal of the theory of constraints. The theory of constraints (TOC) recognizes the performance of origination with constraints volume and it develops a specific approach to focus the system level effects of the continuous improvement.

In general, the drummer constraint sets the production rate of the factory, and the succeeding operation of a factory must match with the production rate of the drummer constraint...

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Chapter 20 Solutions

Cornerstones of Cost Management (Cornerstones Series)
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