A basic assumption of the long run is that a firm:
A) cannot change the amount of labor or capital that it employs.
B) can change the amount of labor and capital that it employs.
C) can change the amount of capital that it employs but not the amount of labor.
D) cannot change the amount of capital that it employs but can change the amount of labor.

Question

Quizplus · Accepted Answer

In the long run, a firm can adjust all of its inputs, including both labor and capital, to reach the desired level of production. This flexibility distinguishes the long run from the short run, where some factors are fixed.

A Basic Assumption of the Long Run Is That a Firm