Question

In the long run, all inputs are _____.

• A. fixed
• B. variable
• C. semi-variable
• D. both A and B

Answer 1

The correct option is B variable

In the long run, firms have the opportunity to expand production by purchasing more machinery, factories etc. These are factors that may be considered fixed in the short run due to the time period that it takes to obtain finances or build the machinery or construct infrastructure.
However, in the long run these factors are taken care of and thus they can be considered variable factors as there are no limitations.