A software firm rents extra cloud servers whenever on-line traffic exceeds 80 % of current capacity. Which capacity strategy is used?

A constant capacity strategy maintains a fixed level of resources regardless of demand fluctuations. This approach does not adapt to changes in traffic, which would lead to either underutilization during low demand or insufficient resources during high demand periods. Thus, it does not align with the firm's practice of renting additional servers as needed.

Lag capacity involves adding resources only after demand has increased and is often characterized by a delay in capacity adjustments. This means that the firm would not be renting extra servers until after the demand exceeds capacity, which could lead to service disruptions. The firm’s proactive approach to renting servers before hitting full capacity does not align with lag capacity.

Lead capacity entails increasing capacity in anticipation of future demand, often to ensure readiness for expected surges. While this strategy prepares for growth, it differs from the firm's reactive approach of renting servers only when current capacity is nearly reached. Therefore, this does not accurately describe the firm's capacity management strategy.