Question

what is the differnce between short run and long run supply curve?

Answer 1

In the short run, supply can only increase with an increase in variable factor of production as fixed factors of production are not variable in the short run. The short run supply curve, therefore, depicts the relationship between price and supply of a firm if the fixed factors of production remain constant.

On the other hand, in the long run, supply can be increased by increasing both, fixed and variable factors of production. The long supply curve, therefore, depicts the relationship between price and supply of a firm if both the inputs of production, i.e labour and capital are variable.