One assumption that distinguishes short-run cost analysis from long-run cost analysis for a profit-maximizing firm is that in the short run,
A)output is not variable.
B)the number of workers used to produce the firm's product is fixed.
C)the size of the factory is fixed.
D)there are no fixed costs.

Question

Quizplus · Accepted Answer

In the short run, at least one factor of production, such as the size of the factory, is fixed, while in the long run, all factors are variable.

One Assumption That Distinguishes Short-Run Cost Analysis from Long-Run Cost