Consider a firm that needs one day to hire more labor,one week to increase its purchases of raw materials,and three months to change the amount of its capital.This firm's long run is
A)three months
B)one week
C)one day
D)three months plus eight days
E)three months plus one week

Question

Quizplus · Accepted Answer

The long run is defined as the period in which a firm can adjust all inputs, including capital. Since it takes three months to change the amount of capital, the long run for this firm is three months.

Consider a Firm That Needs One Day to Hire More