The Number of Years Used to Define Short-Term and Long-Term

question 24

True/False

The number of years used to define short-term and long-term plans has increased considerably because of the greater environmental certainty businesses have today.

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Definitions:

Short Run

A period in economics where at least one factor of production is fixed, limiting the ability of the economy or firm to adjust to changes in demand or supply.

Productive

Relating to or involving the creation of goods or services that satisfy human wants; the efficiency and effectiveness in producing outputs from inputs.

Constant Returns To Scale

A condition where increasing all inputs by any proportion results in output increasing by that same proportion, indicating that size does not affect productivity.

Long-Run Average Total Cost

The cost per unit of output incurred when all factors of production are variable, and scale of production can be changed.