In economics, what differentiates the short run from the long run?
What will be an ideal response?
In the short run, the firm has a fixed factor that limits its level of production. In the long run, all factors are variable. In the short run firms cannot enter or exit the industry. In the long run, this is no longer true.
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A perfectly competitive industry achieves allocative efficiency because
A) goods and services are produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing it. B) firms carry production surpluses. C) it produces where market price equals marginal production cost. D) goods and services are produced at the lowest possible cost.
If speculators lost confidence in foreign economies and so wanted to buy more U.S. bonds
a. the dollar would appreciate which would cause aggregate demand to shift right. b. the dollar would appreciate which would cause aggregate demand to shift left. c. the dollar would depreciate which would cause aggregate demand to shift right. d. the dollar would depreciate which would cause aggregate demand to shift left.