Generally,a firm is more willing and able to increase quantity supplied in response to a price change when
A)the relevant time period is short rather than long.
B)the relevant time period is long rather than short.
C)supply is inelastic.
D)the firm is experiencing capacity problems.

Question

Quizplus · Accepted Answer

In the long run, firms have more flexibility to adjust their production levels and increase the quantity supplied in response to a price change. This is because they can invest in more capital, hire more workers, and expand their operations, which may not be possible in the short run. Additionally, given enough time, new firms may enter the market, increasing overall supply. Therefore, firms are more willing and able to increase quantity supplied in response to a price change when the relevant time period is long rather than short.

Generally,a Firm Is More Willing and Able to Increase Quantity