The short run in macroeconomic analysis is a period:
A) in which many production costs can be taken as fixed.
B) in which wages become fully flexible.
C) of two months, and the long run is more than 12 months.
D) in which interest rates are fixed.

Question

Quizplus · Accepted Answer

The short run in macroeconomic analysis is a period where many production costs, such as rent and capital, are taken as fixed. This means that firms cannot easily change these costs in response to changes in demand or other factors. Wages are not necessarily fully flexible in the short run, as they may be subject to contracts or other agreements that prevent immediate adjustments. The duration of the short run is not a fixed time period, but rather depends on the industry and other factors. Interest rates may or may not be fixed in the short run, depending on the specific circumstances.

The Short Run in Macroeconomic Analysis Is a Period