Which of the following statements is true about capacity utilization?
A)It is the extent to which the capacity designed and installed is actually used.
B)It is the capacity required to be utilized to meet market demand.
C)It is calculated by dividing actual output by effective capacity.
D)It is the ratio of design capacity to effective capacity.

Question

Quizplus · Accepted Answer

Capacity utilization is the ratio of actual output to the capacity designed and installed. It measures the extent to which the installed capacity is put to use.

Which of the Following Statements Is True About Capacity Utilization