https://research.stlouisfed.org/publications/economic-synopses/2016/09/12/employment-and-capacity-utilization-over-the-business-cycle ( open the link, and answer these questions please).

1. What is capacity utilization? What level is considered "normal" capacity utilization? Why is it not 100%?

2. What was the typical relationship between capacity utilization and the employment rate before 1990? How was it different for the recessions of 1990-91 and 2001?

3. Thinking back to our discussion of business cycles, how could capacity utilization be used in predicting inflation pressure in the economy? How could capacity utilization be used in predicting deflation pressure in the economy?