Engineers know at what point a material will fail. They know this by looking up the values in a table. The people who made the table know this because somewhere a long time ago, the material was meticulously tested in a lab environment and the results were recorded for the world to know.
Once you know the material properties, it’s a matter of taking the size and shape of your material, and plugging it all into a formula (or modeling it in software) and verifying that the load does not reach the limit.
What is this “limit” you ask? Typically it’s the point at which the material will bend without returning to its original shape, modified by a safety factor. In your example, let’s say the safety factor is 2. That means the product would break at 500 lb under perfect conditions, but is limited to 250 lb to account for things like user error, defects in the material, etc.
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