1. How might the addition of equipment to a production system lower efficiency?What does this say about replacing labour with equipment to increase productivity?
2. As the process life cycle changes with the product life cycle should a firm change along with it or move into new products more appropriate to its existing process? What factors must be considered in this decision?.
3. Frequently, simple models such as breakeven are much more appealing tomanagement than more sophisticated model (such as linear programming) why might this be so?
4. Exactly what decreases in unit cost occur with larger facilities as a result of economics of scale? Might any costs increase with the size of a facility?