AP MicroeconomicsProduction & Costs
Short Run vs. Long Run
The short run is a period when at least one input is fixed, while the long run is a period when all inputs are variable.
In the short run, firms cannot change plant size or capital, only adjust labor or raw materials. In the long run, firms can adjust all inputs, including building new factories or exiting the industry. This distinction affects cost structures and decision-making.
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