Week 2 PSA 1C Would you say that systems that have higher efficiency ratios than other systems will always have higher utilization ratios than those other systems? Another way to put it: If system A has a higher efficiency ratio than system B, it is always true that system A has a higher utilization ratio than system B? MIS 373: Basic Operations Management

The answer is NO. Here is a counterexample: system A has a higher efficiency ratio but a lower utilization ratio than system B System A: Design capacity: 1000 Effective capacity: 500 Output: 500 System B: Effective capacity: 900 Output: 600 Efficiency = 500/500 = 1 Utilization = 500/1000 = .5 Efficiency = 600/900 = .67 Utilization = 600/1000 = .6 MIS 373: Basic Operations Management