When a firm's design capacity is less than the capacity required to meet its demand, it is said to have a negative capacity cushion.

Name: When a firm's design capacity is less than the capacity required to meet its demand, it is said to have a negative capacity cushion.
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A negative capacity cushion exists when a firm's design capacity is less than the capacity required to meet its demand. This can result in a backlog of orders, longer lead times, and potentially lost sales opportunities.

When a Firm's Design Capacity Is Less Than the Capacity