Costs In The Long-Run
Beginning of paper
Just as some costs are fixed and others are variable so are the
inputs, or resources, or, factors of production used by the firm and this
has an impact on its short and long run operations. These time periods
(the short and the long run) do not refer to specific, chronological time
of hours, days, ....
Middle of paper
.... then operates in a new short run
situation with its capacity constrained to 2,000 sheets per minute whether
it employs 5,6 or 10 men.
Decisions in the long-run are investment or planning decisions
relating to the scale of production and decisions in the short run are to
do with choosing an output level within the capacity constraint.
With this introduction to the firms costs and output decisions we
can now apply them to see how firms decide on the output to produce in
order ....
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Word count: 330
Page count: 2 (approximately 250 words per page)
