-In the short run, firms increase output
A) only by increasing the size of their plant.
B) only by increasing the amount of labour used.
C) only by decreasing the size of their plant.
D) only by decreasing the amount of labour used.
E) either increasing the amount of labour used or increasing the size of their plant.

Question

-In the short run, firms increase output
A) only by increasing the size of their plant. 
B) only by increasing the amount of labour used. 
C) only by decreasing the size of their plant. 
D) only by decreasing the amount of labour used. 
E) either increasing the amount of labour used or increasing the size of their plant.

Quizplus · Accepted Answer

In the short run, firms typically cannot change the size of their plant due to time and cost constraints. Instead, they adjust output levels by varying the amount of labor used, such as hiring more workers or increasing working hours.

-In the Short Run, Firms Increase Output