What do you understand by the term “Excess Capacity”?
Introduction Excess capacity is a concept in microeconomics that is often discussed in the context of monopolistic competition. It refers to a situation where a firm produces less than the level of output that minimizes its average total cost. In simpler words, the firm is not using its full productive capacity, meaning that it could […]
What do you understand by the term “Excess Capacity”? Read More »