Description: Capacity limit refers to the maximum amount of goods or services that can be produced or handled in a given period of time. This concept is fundamental in operations and production management, as it determines the efficiency and effectiveness of a production system. A capacity limit can be influenced by various factors, including resource availability, technology used, labor, and infrastructure. Understanding and managing capacity limits is crucial for optimizing business performance, as a limit that is too low can result in missed opportunities, while one that is too high can lead to inefficiencies and additional costs. Therefore, businesses must constantly evaluate their capacities and adjust their operations to align with market demand, ensuring a balance between production and customer satisfaction.
