a firm that produces and sells furniture gets to choose

questioned by administrator @ in Business viewed by 99 People

A firm that produces and sells furniture gets to choose Select one: a. the number of machines it uses in the short run but not in the long run. b. how many workers to hire in both the short run and the long run. c. which short-run average-total-cost curve to use in both the short run and the long run. d. the size of its factories in the short run but not in the long run.

Answered by administrator @


Answer: b. how many workers to hire in both the short run and the long run.

Explanation:

In both the short and long run, producers can change their variable factors of production in response to the needs of the market unlike with fixed factors of production that can only be changed in the long run. Labor is a variable factor of production and so can be changed in the short run

For instance, if the demand for furniture suddenly increases,  the firm can hire more people in order to be able to produce enough furniture for the market.


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