Capital cannot be adjusted in the short run because:
A) there is not sufficient time to adjust it.
B) it is too expensive to alter the capital stock.
C) capital markets do not function well enough in the short run.
D) the firm has yet to decide what product to produce, so it does not yet know what kind of capital it needs.

Question

Quizplus · Accepted Answer

Capital cannot be adjusted in the short run primarily because there is not sufficient time to adjust it. Adjusting capital often involves significant planning, purchasing, and installation time, which cannot be accomplished quickly.

Capital Cannot Be Adjusted in the Short Run Because