Capacity is the maximum volume of activity that a company can sustain with available:
A)Resources.
B)Discretionary orders.
C)Inventory.
D)Employees.
E)None of the above.

Question

Quizplus · Accepted Answer

Capacity refers to the maximum ability of a company to produce goods or services with the available resources such as manpower, machinery, capital, and time. Therefore, choice A, Resources, is the best answer. Discretionary orders, inventory, and employees may impact capacity but are not determinants of maximum volume of activity.

Capacity Is the Maximum Volume of Activity That a Company