Excess capacity refers to a production capacity which falls below the potential capacity available to the producer.
Excess Capacity. Occurs when a firm or industry is operating below cost-minimizing levels of output.
Excess Capacity: This term refers to the amount of available plant and equipment not in use. When producers have spare capacity, they tend to reduce prices or minimize price increases in order to boost sales.
excess capacity a situation in which a firm produces below the level that gives minimum average total cost. (11)
excess costs costs of production that are higher than the minimum average total cost. (11) ...
Excess capacity (under monopolistic competition) - The property of long run equilibrium in monopolistic competition that firms produce on the falling portion of their average total cost curves so that they have excess capacity measured by the ...
EXCESS CAPACITY: A condition that exists when monopolistic competition achieves long-run equilibrium such that production by each firm is less than minimum efficient scale.
Excess Capacity (in accounting)
Idle Capacity Variance (in accounting)
Short-Term (Short-Run) Decisions (in accounting) ...
A situation in which actual production is less than what is achievable or optimal for a firm. This often means that the demand in the market for the product is below what the firm could potentially supply to the market.
Deflation is dangerous, however, more so even than inflation, when it reflects a sharp slump in DEMAND, excess CAPACITY and a shrinking MONEY SUPPLY, as in the Great DEPRESSION of the early 1930s.
Deliberate building of excess capacity happens because of the difficulties involved in laying fibre optic cables: digging up the ground (or even worse, running cables through oceans) is very expensive, ...
There was a huge buildup of excess capacity. The mainly state-owned banking system played an instrumental role in this. It has the bulk of the domestic savings, and the bulk of its lending goes to state
By Diana Choyleva ...
The supplier may bid relatively low if excess capacity is available to be filled, or it may bid relatively high if it has a significant competitive advantage.
Accordingly, rather than looking to simply pick up "dots on a map"- with multiple facilities and infrastructure (and often excess capacity) that is both expensive and can spread management resources thin - buyers are increasingly targeting firms ...
In addition to that, an organization needs to choose an appropriate order pattern (e.g. 'Just- in- time') to avoid excess capacity.
'B' items are important, but of course less important, than 'A' items and more important than 'C' items.
If GDP exceeds its natural level, inflation will accelerate as suppliers increase their prices. If GDP falls below its natural level, inflation will decelerate as suppliers attempt to fill excess capacity.
Frequently, however, qualified willing workers are involuntarily unemployed; there is no demand for the products they would produce. More spending will put them to work. Competition from firms with excess capacity and from idle workers will keep ...
See also: Gross, Sector, Transaction, Expense, Banks