In the long run,
A)at least one of the firm's inputs is fixed
B)customer tastes and preferences are fixed
C)the firm may vary all inputs
D)sunk costs become variable costs
E)government intervention is inevitable

Question

Quizplus · Accepted Answer

In the long run, the firm has the flexibility to vary all inputs, including capital and labor. This is because all inputs become variable in the long run as fixed costs become variable costs. The firm can adjust its production level and size of its plant to maximize its profits based on changing market conditions. A and B are not true as in the long run, all inputs can be varied. D and E are not true in the long run as well.

In the Long Run