Capacity utilisation
What Capacity utilisation means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Capacity utilisation
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Reference: Pearson Edexcel
The proportion of maximum possible output currently being produced, calculated as current output divided by maximum possible output and expressed as a percentage.
Increasing this by asking existing staff to work overtime is a short-term response to increased demand.
Topics that use Capacity utilisation
- Conditions that prompt trade (Pearson Edexcel A-Level)
- Price mechanism (Pearson Edexcel A-Level)
Related terms
- Domestic competition
- Economies of scale
- Extension strategies
- Fixed costs
- Global supply chains
- International competitiveness
- International trade
- Market dynamics
Using Capacity utilisation in the exam
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