Capacity constraint? (Pls help, exam is comin.... >.<)?

Question

In the tourism and hospitality industries, the ability to supply goods and service is often limited by the existence of capacity constraints. Explain what a capacity constraint is, and how it acts to limit the possible levels of output for a firm.

Thanks

Answer 1

Capacity constraints is what it says...You are limited by the capacity...

Suppose your hotel has 100 rooms you can't book a 1000 guests on the same day...Your resturant has 20 tables, you can only handle so many customers...Airplane has 200 seats, etc.

The only industries that has virtually no capacity constraint, that I can think of, is software and broadcasting.