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Question
Macroeconomics
Posted 10 months ago
From Schear to Eternity is a bakery specializing in baking bagels.
Which of the following is most likely to be an input that can be adjusted in the long run, but not the short run?
Choose 1 answer:
(A) the flour, an ingredient used in the dough
(B) the yeast, an ingredient used in the dough
(c) the workers in the bakery
(D) the industrial sized oven used to bake bagels.
(E) natural gas to power the ovens
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Answer from Sia
Posted 10 months ago
Solution
a
Long Run vs. Short Run Adjustments: In the short run, at least one factor of production is fixed, while in the long run, all factors of production can be varied
b
Identifying Fixed and Variable Inputs: Ingredients like flour and yeast (options A and B) and energy (option E) are typically variable inputs that can be adjusted in the short run. Labor (option C) can often be adjusted in the short run as well, though with some limitations. Capital, such as the industrial-sized oven (option D), is usually a fixed input in the short run and can only be adjusted in the long run
Answer
(D) the industrial sized oven used to bake bagels.
Key Concept
Fixed and Variable Inputs in the Short and Long Run
Explanation
Capital equipment like an industrial-sized oven is typically a fixed input in the short run and can only be adjusted in the long run.
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