The Long Run Is a Period of

question 62

Multiple Choice

The long run is a period of

• A) at least one year.
• B) sufficient length to allow a firm to expand output by hiring additional workers.
• C) sufficient length to allow a firm to alter its plant size and capacity and all other factors of production.
• D) sufficient length to allow a firm to transform economic losses into economic profits.

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Definitions:

Purely Competitive

An economic market structure characterized by many buyers and sellers, homogeneous products, and no single participant having a significant influence on price.

Wage Rate

The amount of compensation a worker receives per unit of time (e.g., hour, day) or per task completed.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor of production.

Purely Competitive

A market structure characterized by many sellers offering identical products, leading to a high degree of competition.