In order for firms to remain competitive they have had to control costs, cutting down
excess capacity and reducing employment.
In reality a small amount of excess capacity is expected.
The telecommunications industry is plagued by excess capacity.
If excess capacity develops, the losers will be those with the least attractive products.
Airline officials say excess capacity has pushed inflation-adjusted average fares
to levels unseen since the late 1980s, resulting in billions of dollars in annual
losses for the industry.
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