Long Run vs

Choose a study mode

Play Quiz

Study Flashcards

Spaced Repetition

Chat to Lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What is the long-run in economics?

The long-run is a theoretical concept in which all markets are in equilibrium, and all prices and quantities have fully adjusted and are in equilibrium.

How does the long-run contrast with the short-run in economics?

The long-run contrasts with the short-run as in the long-run there are no fixed factors of production, and there is enough time for adjustment so that there are no constraints preventing changing the output level by changing the capital stock or by entering or leaving an industry.

What are the characteristics of the long-run in microeconomics?

In microeconomics, there are no fixed factors of production in the long-run, and there is enough time for adjustment so that there are no constraints preventing changing the output level by changing the capital stock or by entering or leaving an industry.

How are factors different in the short-run compared to the long-run in microeconomics?

<p>In the short-run, some factors are variable (dependent on the quantity produced) and others are fixed (paid once), constraining entry or exit from an industry.</p> Signup and view all the answers

What happens in the long-run in macroeconomics?

<p>In macroeconomics, the long-run is the period when the general price level, contractual wage rates, and expectations adjust fully to the state of the economy.</p> Signup and view all the answers