The capacity that could cause a downward spiral (or death spiral) is
A)theoretical capacity.
B)practical capacity.
C)productive capacity.
D)normal capacity.

Question

Quizplus · Accepted Answer

Normal capacity can lead to a death spiral because it is based on average demand, which can result in underutilization and higher per-unit costs if demand decreases, leading to further price increases and reduced demand.

The Capacity That Could Cause a Downward Spiral (Or Death