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A test for strategic excess capacity

✍ Scribed by K. Conrad; M. R. Veall


Book ID
105117554
Publisher
Springer-Verlag
Year
1991
Tongue
English
Weight
685 KB
Volume
16
Category
Article
ISSN
0377-7332

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## Abstract Excess capacity is expensive, yet persistent excess capacity is widely observed in the corporate sector. Using a real‐option approach to capacity planning, this paper shows that under certain conditions it is optimal to invest in long‐term (even permanent) excess capacity. This results