Question

What is the difference in the short-run and long-run in microeconomics?

Answer 1

In the short run at least one of the factor of production cannot be varied and therefore remains fixed. In order to vary output level in the short run the firm can vary only the other factor. The factor that remains fixed is called the fixed factor and the other factor which the firm can vary in the short run is called variable factor.

On the other hand in the long run all the of the factors of production can be varied. In order to produce different levels of output, a firm in the long run may vary both of the inputs simultaneously. So show in the long run there is no fixed factor of production.