Question

A loan processing operation processes an average of 6 loans per day. The operation has a design capacity of 16 loans per day and an effective capacity of 13 loans per day. What is the difference between the design capacity and the effective capacity of the loan processing operation?

1) 10 loans per day
2) 7 loans per day
3) 3 loans per day
4) Cannot be determined

Answer 1

The difference between the design capacity and the effective capacity of the loan processing operation is 3 loans per day. The design capacity is 16 loans per day, and the effective capacity is 13 loans per day.

Step-by-step explanation:

The question at hand involves determining the difference between the design capacity and the effective capacity of a loan processing operation. The design capacity is defined as the maximum output that can be achieved under ideal conditions, while the effective capacity is the maximum output that can be achieved under realistic and normal working conditions, considering factors like machine maintenance, breaks, and problems in the process.

To find the difference between the design capacity and the effective capacity, we simply subtract the effective capacity from the design capacity. In numerical terms, this is:

• Design capacity = 16 loans per day
• Effective capacity = 13 loans per day
• Difference = Design capacity - Effective capacity = 16 - 13 = 3 loans per day

Therefore, the difference between the design capacity and the effective capacity is 3 loans per day, which corresponds to option 3).