Concerns about production capacity apply to physical goods but they are not relevant when the product is a service.

Question

Quizplus · Accepted Answer

While concerns about production capacity may not apply in the same way to services as they do to physical goods, there are still limitations on the amount of service that can be provided at any given time. For example, a restaurant may have limited seating and staff, which can impact the number of customers they can serve at a given time. In addition, there may be limitations on the availability of resources needed to provide the service, such as a shortage of skilled workers or limited access to technology or equipment. Therefore, production capacity concerns can still apply to services, albeit in a different way than they do to physical goods.

Concerns About Production Capacity Apply to Physical Goods but They