Short Run, Long Run And Long Run And Two Concepts

Micro economics is the branch of economics that analyzes the market behavior of of the individual consumer or firm to understand the decision making of either a household or firm in economics. It is concerned with how the consumer and buyer interact and what facts might influence the buyer or seller. While micro economics is a broad study of field, their are many concepts within macro economics that are very important. The two concepts I will be defining in this paper is Long run and Short run in Micro economics. In economics, the short run and the long run are used for referencing different time approaches. Many other concepts such as supply, demand, etc. are also involved with the short and long run to analyze the changes from one time …show more content…
The short run is a period of time where the quantity of at least one input is fixed and the quantities of the other inputs can be varied, while the long run is a period of time in which quantities of all inputs can be varied. For a short run, the time can range from anywhere from a couple weeks to a month or possibly even longer. For a business, during the short run its a good period to increase their raw materials or the labor since these two things are much more easier to accomplish then the other factors of …show more content…
An easier way to describe it would be through an example. For the example, I will use a company that creates golf sticks. Their company will need different things to manufacture the good, like labor, machinery, the materials that go into making the club, and the factory where it is made at. Lets just say that the demand for golf clubs goes up during the summer, so the company needs to produce more clubs. The company should be able to order to get the materials for the clubs quickly so its a variable input. A variable input is an input where the quantity changes according to the output. Some examples are raw machinery, transportation and communication. Another variable input would be the labor going in to making the club. The equipment that is used to make the golf club may or may not be a variable input depending on how long it would take to get the equipment and then teach the workers how they use the machines. You could possibly also just add a new factory but that would be very time consuming and something that would not be possible in a short span of time. That would make it a fixed input. A fixed input is an input which the quantity doesn 't change according to how the output