In the long run, a firm can increase production by
A)increasing variable costs.
B)increasing capital input.
C)reducing labor input.
D)shutting down.
E)minimizing fixed costs.

Question

Quizplus · Accepted Answer

Increasing capital input allows for the firm to have better technology, more efficient production processes, and potentially a larger scale of production which can lead to an increase in output in the long run. The other options listed, such as increasing variable costs or minimizing fixed costs, may not necessarily lead to an increase in production. Reducing labor input may also not be feasible depending on the industry and the type of production being done. Shutting down would obviously lead to no increase in production.

In the Long Run, a Firm Can Increase Production by