DOS

Question 1

whats DOS

Answer 1

when you get too big and therefore, things start to go wrong

cost per unit rises again as outpiut rises

Question 2

causes of DOS

Answer 2

• communication problems
• morale suffering as it becomes a less important issue
• technical DOS = impact of a breakdown becomes much bigger so managing size of production gets harder and harder

Question 3

disadvantages of DOS

Answer 3

• may be forced to pay ovetime if it gets closer to full capacity to meet orders
  = rise in unit costs that reduce margins
• full capacity is reaches so machines may be working for longer
  = reducing time to maintain them which can lead to breakdowns
• must be monitored carefully with larger firms needing to review the impacts on costs when they take the decision to increase the overall size of the firm