Capacity utilization is a concept in economics and managerial accounting which refers to the extent to which an enterprise or a nation actually uses its installed productive capacity. Thus, it refers to the relationship between actual output that 'is' produced with the installed equipment and the potential output which 'could' be produced with it, if capacity was fully used.
Read more about Capacity Utilization: Economic Significance, Measurement, Engineering and Economic Measures, Output Gap Percentage Formula, FRB and ISM Utilization Indexes, Data
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“To succeed in the other trades, capacity must be shown; in the law, concealment of it will do.”
—Mark Twain [Samuel Langhorne Clemens] (1835–1910)
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