The difference between the number of widgets it can make compared to the number of widgets it makes is the basis for the machine's utilization rate. This means it will never make as many widgets as it's capable of producing. It needs to shut down occasionally for maintenance and repairs, user training, and any number of other reasons. But of course, it can't run non-stop, every day, all day. That's the machine’s total available capacity. Let's say, assuming the machine runs non-stop, it can produce 1,000 widgets a day. The machine has a maximum number of widgets it can produce in a day, because it takes a certain amount of time for the machine to manufacture one widget. To understand utilization and utilization rates, let’s imagine we have a widget-making machine.

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