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How does the impact of fixed costs change production decisions in the short run and in the long run?
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32 votes
32 votes
How does the impact of fixed costs change production decisions in the short run and in the long run?

User AVTUNEY
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1 Answer

17 votes
17 votes

Answer:

They have no impact.

Step-by-step explanation:

Fixed costs have no impact on a firm's short run decisions. ... In the short run, a firm that is maximizing its profits will: Increase production if the marginal cost is less than the marginal revenue. Decrease production if marginal cost is greater than marginal revenue.

User Ali Qanbari
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