Full capacity
Definition: When a firm or economy cannot produce more with existing resources
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Judging how close an economy is to operating at full capacity is an important ingredient of MONETARY POLICY, for if there is not enough spare capacity to absorb an increase in DEMAND, PRICES are likely to rise instead.
In this diagram the level of full capacity (Yf) is shown by the point where the AS curve is inelastic (equivalent to inelastic LRAS). However, in short term, output Y1 is less than Yf indicating spare capacity.
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If the overhead of the ambulance company was $30,000,000, the overhead allocation would be either $3,000 per call (based on estimated activity) or $1,000 per call (based on full capacity utilization).
Expansionary gap - When the equilibrium level of real national income exceeds the full capacity level of real national income; the positive difference between total desired spending and the full capacity level of real national income.
The time of life at which a person acquires full capacity to make his or her own contracts and deeds and to transact business or to enter into some particular contract or relation, such as marriage.
and alternative energy generation, such as hydroelectric power from the Three Gorges Dam (a full capacity of 18.2 million kilowatts per hour is projected by 2011).
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The maximum level of output of goods and/or services that a given system can potentially produce over a set period of time. In most cases, it is unlikely that any system will operate at full capacity for prolonged periods, ...
For example, additional manufacturing equipment and supervisory staff may be needed. The marketer must know that when operating at full capacity, ...
 See also: Expense, Constraint, Values, Compensation, Fixed costs
  
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