The Main Difference to an Economist Between "Short-Run" and "Long-Run

question 97

Multiple Choice

The main difference to an economist between "short-run" and "long-run" is that:

• A) Variable costs are short-run investment decisions where as fixed costs are long-run production decisions.
• B) In the short-run all resources are fixed where as in the long-run all resources are variable.
• C) In the long-run all resources are variable where as in the short-run at least one resource is fixed.
• D) Fixed costs are more important then variable costs in the short-run.

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Definitions:

Marginal Cost Curve

A graphical representation showing how the cost of producing one additional unit of a good varies as the production volume changes.

Marginal Utility

The additional satisfaction or utility that a person receives from consuming an additional unit of a good or service.

Consumer's Income

The total amount of income available to an individual or household to spend or save, after taxes and other deductions.

Units of Product

Specific quantities of a product produced, identified for purposes of measurement, sale, or analysis.