Question

The short run is:________

a. a period of time in which at least one input cannot be varied.
b. when firms are stuck with sunk costs, unlike the long run.
c. treated the same way as the long run.
d. a period of time when no inputs can be varied.

Answer 1

The correct answer is option a.

Step-by-step explanation:

The short-run is an imaginary short period in which all the inputs cannot be varied. There is at least one input that cannot be varied. So in the short run, there are some fixed inputs and some variable inputs.

The cost incurred on fixed inputs are fixed costs and that incurred on variable inputs are variable costs. So there are fixed costs and variable costs in the short run.

In the long run, all inputs are variable so all costs are variable as well.