Asked by Katie Moules on Jul 15, 2024
Verified
In the short-run:
A) All inputs are variable
B) Some inputs are fixed and some inputs are variable
C) There are no fixed inputs
D) The firm is not restricted in how much it can produce
Fixed Inputs
Resources in production that remain constant in quantity regardless of the level of output or activity.
Variable Inputs
Resources used in production that vary with the level of output, such as raw materials.
Short-Run
A period of time in economics where at least one input is fixed, limiting the ability to fully adjust to market changes.
- Differentiate between short-run and long-run costs in the context of variable and fixed inputs.
Verified Answer
HG
Halima GravesJul 17, 2024
Final Answer :
B
Explanation :
In the short-run, some inputs are fixed and some inputs are variable. This means that while some factors, like capital or long-term contracts, cannot be adjusted in the short run, the firm can vary other inputs like labor or raw materials to change their production output within certain limits.
Learning Objectives
- Differentiate between short-run and long-run costs in the context of variable and fixed inputs.