Explain the difference between a short-run and a long-run credit constraint. Give an example of a...

Explain the difference between a short-run and a long-run credit constraint. Give an example of a policy that could overcome each type of constraint. Why is it important for financial aid policy to distinguish between short- and long-run credit constraints?

Expert Solution

Rahul Sunny answered 8 months ago

3.1. Explain the difference between the short-run and the long-run production function. Cite one example of...

3.1. Explain the difference between the short-run and the long-run production function. Cite one example of this difference in a business situation. (6) 3.2. Explain the relationship between the law of diminishing returns and the three stages of production using a graph showing total, marginal and average product. (10)

Explain the difference between production in the short run and production in the long run.

A. 1. Explain the difference between the short run and the long run as it relates...

A. 1. Explain the difference between the short run and the long run as it relates to a firm’s production function. 2. Why is this distinction important to a firm’s manager? Explain. B. Short-run decisions are frequently referred to as “constrained” decisions, while long-run decisions are frequently referred to as “planning” decisions. Why is this the case? Explain.

1-The key difference between short run and long run is * 2-In the short- run equilibrium,...

1-The key difference between short run and long run is * 2-In the short- run equilibrium, if Real GDP ˂ Potential GDP, then over time price level will * 3-Okun’s law states that * 4-If the long-run aggregate supply curve is vertical, then changes in aggregate demand affect: * 5-If government reduces taxes, in the short run, *

Question 1. What is the difference between the short-run and the long-run? Question 2. Explain the...

Question 1. What is the difference between the short-run and the long-run? Question 2. Explain the concepts of shocks in aggregate demand and aggregate supply. Question 3. What is stabilization policy? Question 4. Explain the impact of an increase in the money supply in the short-run and in the long run Question 5. Which of the following changes would contribute to a decline in the index of leading indicators suggesting that a recession is more likely? a. A rise in...

What is the difference in the short run and the long run? In the short run,...

What is the difference in the short run and the long run? In the short run, A. at least one of the firm's inputs is fixed, while in the long run, at least one of the firm's inputs is variable. B. at least one of the firm's inputs is fixed, while in the long run, the firm is either able to vary all its inputs, adopt new technology, or change the size of its physical plant. C. at least one...

Difference between production in the short run and production in the long run: 1. What is...

Difference between production in the short run and production in the long run: 1. What is the difference between the short-run and long-run? Is there a fixed time period associated with short-run and long-run? Explain why or why not. 2. What happens to output in the short-run as production increases? What inputs are "fixed" and which input is variable in the short-run? How does this explain diminishing marginal productivity? 3. What might happen to output in the long-run as the...

1. What is the difference between the short run and the long run for the profit-maximizing...

1. What is the difference between the short run and the long run for the profit-maximizing firm? 2. The number of repairs produced by a computer retail shop depends on the number of workers as follows: Number of Workers Number of Repair Marginal Product (what each additional worker adds to the total production) Average Product (the number of units per worker) 0 0 - 1 8 2 20 3 35 4 45 5 52 6 57 7 60 a. For...

a) What is the difference between the short-run AS curve and the long-run AS curve? Define...

a) What is the difference between the short-run AS curve and the long-run AS curve? Define each and explain the underlying assumptions. What would cause each to shift either to the right or left? b) What does the concept “sticky wages” refer to? Explain its implications within the AD/AS model.

1. The difference between a monopolistically competitive firm in the short run versus the long run...

1. The difference between a monopolistically competitive firm in the short run versus the long run is: profit is equal to zero in the long run but not the short run. firms only have P > MC in the short run but not the long run. firms only produce at MR = MC in the short run. firms only have P > MC in the long run but not the short run. This is true because: the industry can be...

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