Efficiency is the amount of effective capacity that is utilized on average in fulfilling demand.
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Q5: Design capacity is the maximum theoretical output
Q6: Effective capacity is the capacity of the
Q7: Potential capacity is the capacity that can
Q8: Capacity utilization is the amount of effective
Q9: Capacity utilization always exceeds design capacity.
Q11: Utilization in services is usually high because
Q12: Design capacity may be increased by identifying
Q13: Capacity planning is important to businesses primarily
Q14: Excess capacity is always better for the
Q15: Higher contribution margins lead firms to invest
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