The short-run refers to:
A)a time period of two years or less.
B)the time period in which the usage of all inputs are held constant.
C)the time period in which it is too costly to change the usage of at least one input.
D)the time period in which the usage of all inputs can be changed.

Question

Quizplus · Accepted Answer

In the short-run, firms are unable to adjust the usage of at least one input due to the high cost of doing so. This fixed input is typically capital or a specialized resource, and as such, firms are constrained in their ability to adjust production levels. The short-run is usually defined as a time period of less than one year. Choices A, B, and D are incorrect because they do not accurately describe the constraints on input usage within the short-run.

The Short-Run Refers To