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utilization


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The ratio of the actual output of an operating system to its designed capacity. For example, if the designed capacity of a plant is 4000 units per week and the output is 3000 units per week, the utilization is 75%. However, it is important to remember that 75% represents the utilization of the most restricted part of the operating system, i.e. the bottleneck. If other parts of the plant are capable of more than 4000 units per week their utilization will be lower.

Subjects: Business and Management.


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