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When a company is operating near its capacity limits, what likely results is the effect of...

When a company is operating near its capacity limits, what likely results is the

effect of nonlinear relations
effect of outliers on the computed regression
effect of spurious relations
effect of using data that violates regression assumptions
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Answer #1

Solution: effect of nonlinear relations

Explanation: When the available capacity is less than the settling capacity, it can have a significant impact of the nonlinear effects. The limit of capacity acts as a production smoothing mechanism, at the cost of increasing inventory variability

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