Describe the state of "long-run equilibrium" in as much detail as you can.

Expert Solution

The long run is a period of time in which all factors of production and costs are variable. In the long run firms are able to adjust all costs, whereas, in short run, firms are only able to influence prices through adjustments made to production levels.

Additionally, while a firm may be a monopoly in the short term, they may expect competition in the long run.

In economics, long- run models may shift away from short-run equilibrium, in which supply and demand react to price levels with more flexibility.

The long run is a time period during which a manufacturer or producer is flexible in its production decisions.

In the long run, the amount of labour, size of the factory, and production processes can be altered if need be.

In response to expected economic profits, firms can change production levels.

Rahul Sunny answered 2 years ago

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