If the firm can vary all factors of production, it is operating
A) at a profit.
B) at a zero economic profit.
C) in the short run.
D) in the long run.

Question

Quizplus · Accepted Answer

If the firm can vary all factors of production, it is operating in the long run. This means that it has the flexibility to adjust all inputs and make changes to its production processes, including expanding or decreasing its scale of operations. In the long run, the firm can achieve a state where it earns zero economic profit, taking into account all costs, including opportunity costs.

If the Firm Can Vary All Factors of Production, It