capacity

Examples of capacity in the following topics:

• Defining Monopolistic Competition

  • Unlike in perfect competition, firms that are monopolistically competitive maintain spare capacity.
  • The second source of inefficiency is the fact that these firms operate with excess capacity.
  • In the long run, this leads to excess capacity.

• Supply Reduction

  • Agricultural aggregate supply can be reduced through external capacity potential or governmental interventions.
  • Agricultural economics is largely bound by concepts of climate and overall world food producing capacity (i.e. farmlands and infrastructure), while simultaneously being enabled by government policy, technological advances, and the continued growth of developing nations.

• Production Possibility Frontier

  • Within an economy, if the capacity to produce both goods increases, the result is economic growth.
  • Factors that influence economic capacity include technology, an increase in the supply of factors of production, and production interactions such as trade and exchange.
  • When any of these factors are used it allows for an increase in capacity so that the production of neither good has to be sacrificed.

• Long Run Outcome of Monopolistic Competition

• Infant Industry Argument

  • The reason for this is quite simply the significant jump in prosperity as international trade expanded, and the huge capacity for specialization, economies of scale, technology sharing, and a host of other advantages that have been a direct result of free global markets.
  • Infant industries generally do not have the capacity to do this.

• Definition of Price Elasticity of Supply

  • There are numerous factors that directly impact the elasticity of supply for a good including stock, time period, availability of substitutes, and spare capacity.
  • Spare capacity: it is easy to increase production if there is a shift in demand.

• The Importance of Productivity

  • This allows for better compensation for employees, more working capital and an improved competitive capacity.
  • The final important consideration in assessing productivity potential is the production-possibility frontier (PPF), which essentially outlines the maximum production quantity of two goods (in the scope of our current technological capacity and supply).

• Introduction to Inflation

  • Demand-pull inflation is inflation that occurs when total demand for goods and services exceeds the economy's capacity to produce those goods.
  • Eventually, production cannot keep pace with aggregate demand because of capacity constraints, so prices rise .

• Defining and Measuring Economic Mobility

  • This concept of economic mobility is often considered in conjunction with 'social mobility', which is the capacity for an individual to change station within a society.
  • Intergenerational:Intergenerational mobility pertains to a person's capacity to alter their station relative to the economic status of their parents or grandparents, essentially the flexibility within a society to allow individuals to grow regardless of their initial station.

• Demand Curve

  • The suppliers in this market will also have excess production capacity.