What type 0f adjustments can a firm make in the long run that it cannot make in

Question

What type 0f adjustments can a firm make in the long run that it cannot make in the short run? What adjustments can it make in the short run? State the law of diminishing marginal returns. Exactly what is it that diminishes, and why does it diminish? What is the relationship between TP and MP? Why do short-run VCs increase at first by decreasing amounts and later increase by increasing amounts? Describe the way in which short-run AFC, AVC, ATC, and MC vary as the output of the firm increases? What are the connections between MP and MC and AP and AVC? How will MC behave as MP increase or decrease? How will AVC change as AP rises or falls? What are the precise relationships between MC and minimum AVC: and between MC and minimum ATC? What does the long-run ATC curve of a firm show? What relationship is there between long-run ATC and the short-run ATC schedules of the different-sized plants which a firm might build? Why is the long-run ATC curve of the firm u- shaped? What is meant be economies of scale and diseconomies of scale? What factors contribute to both? What is minimum efficient scale? Define and explain labor market discrimination and the four discriminatory practices.

Explanation / Answer

** Each question to be shared separately***

Solution to Q1.

1. In the long run, all factors like capital and labour are variable and can be adjusted according to the level of production However, in the short run these inputs remain almost constant and cannot be altered. hence, the long run offers more flexibility to produce and alter the level of production. For example, a firm making losses in the short run may choose to go out of production in the long run, which means theat the factor inputs are adjustabe in the long run.

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.