Utilization Will Always Be Lower Than Efficiency Because

question 111

Multiple Choice

Utilization will always be lower than efficiency because

• A) effective capacity is less than design capacity.
• B) effective capacity is greater than design capacity.
• C) effective capacity equals design capacity.
• D) utilization and efficiency are equal in value.
• E) utilization is normally greater than efficiency.

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Definitions:

Deforested

Areas that have been cleared of trees and converted to non-forest use.

Extraction Cost

All costs associated with extracting a natural resource and readying it for sale.

User Cost

The opportunity cost of using a durable good, which includes the depreciation of the good and any cost associated with its use, such as maintenance.

Enforceable Property Rights

The legal recognition of an individual's or entity's claims to ownership, which can be defended and upheld in court.