Economics Multiple Choice Question – 31 July 2017

Economics

Excess capacity means?

Select ONE answer:

  1. Supply is less than demand
  2. Demand exceeds sales
  3. A firm is producing less than its competitors
  4. A firm is producing less than it could
  5. A firm can sell more than it can make

Explain why a firm might have excess capacity?
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Economics KS5 classes.

The answer is 4 – Excess capacity is a situation in which actual production is less than what is achievable or optimal for a firm. This often means that the demand for the product is below what the business could potentially supply to the market.

 

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Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

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