A basic distinction between the long run and the short run is that
A) if a firm produces no output in the long run, it still incurs a cost.
B) the opportunity costs of production are lower in the short run than in the long run.
C) in the long run, some inputs are fixed, while in the short run, all inputs are variable.
D) in the short run, complete adjustment of all inputs is impossible, while in the long run all inputs can be adjusted.
Answer: D
You might also like to view...
Which of the following adjusts to bring aggregate demand and aggregate supply into balance?
a) the price level but not the quantity of output b) the quantity of output but not the price level c) both the price level and the quantity of output d) variables other than the price level and the quantity of output
An increase in income in an open economy nation will cause a change in consumer spending on home production, and a(n):
a. increase in taxes. b. decrease in savings. c. increase in foreign production. d. increase in imports if MPCF (marginal propensity to consume foreign goods) is greater than zero.