An analysis of the production decision made by a firm in the long run. The central characteristic of long-run production analysis is that all inputs under the control of the firm are variable. The central principle guiding production in the long run is returns to scale, which indicates how production responds to proportional changes in all inputs. A contrasting analysis is short-run production analysis.
Short Run: The short run is a period of time in which at least one input used for production and under the control of the producer is variable and at least one input is fixed.
Long Run: The long run is a period of time in which at all inputs used for production and under the control of the producer are variable
Short Run: The short run is a period of time in which at least one input used for production and under the control of the producer is variable and at least one input is fixed.
Long Run: The long run is a period of time in which at all inputs used for production and under the control of the producer are variable