Short run
Long run
Both periods
None of the period
✅ The correct answer is B.
All inputs can be varied in Long run. The long run is defined as a period in which all INPUTS are variable. Because of that all costs are variable too. You’re right that in the short run your rent and the cost of the machines you’ve already bought are fixed costs. But in the long term they aren’t.
All inputs can be varied in Long run. The long run is defined as a period in which all INPUTS are variable. Because of that all costs are variable too. You’re right that in the short run your rent and the cost of the machines you’ve already bought are fixed costs. But in the long term they aren’t.