Final answer:
To enhance capacity management, consider hiring more workers, investing in more machines, and redistributing workload across different weeks. These tactics align with broader decisions on whether to expand production or adjust the workforce according to changing demand.
Step-by-step explanation:
To improve capacity management based on the given graph, several strategies could be considered. These include hiring more workers, which would increase labor input and potentially production output if the firm is experiencing a labor shortage. Another option is to invest in more machines, which can expand production capabilities and technology efficiency, particularly important if the demand has increased significantly. Lastly, to manage short-term fluctuations in capacity, it may be helpful to spread hours exceeding normal capacity to other weeks with unused capacities. This approach could involve adjusting work schedules or using flexible labor practices to ensure a more even and efficient use of resources over time.
These strategies reflect broader business decisions such as whether to expand or reduce production, hire workers or lay them off, or pursue changes that would improve the firm’s production possibilities and efficiency in the long run. For example, if a firm's demand increases substantially, like tripling to 15 documents per day, acquiring more PCs to give a new short run production function could be an efficient solution.