In a recession, is capacity utilization above or below its long-run average? Explain.?

Answer 1

Pray global capacity utilization--on ANY supply level--never breaks or it could be the start of a real sh!tty day. Because of advanced techonological advancements in production assembly lines, product quality standards and communication overall, doubts exist that we'll see such a catastrophic supply breakdown.

Answer 2

Capacity utilization is below its long run average due to the lack of efficient use of resources, such as unemployment. The point is below the PPC curve.

Answer 3

Below.

In a recession, labour is underused. There are non-working people who would want to be working ("unemployment"), people working at dead-end or part-time jobs who are qualified for higher-paid and full-time jobs ("underemployment"). Capital is also underused -- companies are producing less, on average, than they were last year so the machinery and equipment for production is not being as fully used.

Answer 4

common sense suggests below.