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JAMB Economics 2007 Question 20

Question 20

Theory of Costs and Revenue

A firm incurs short-run costs when

  1. A.operation is at its early stages
  2. B.it cannot increase prices
  3. C.some inputs cannot be varied
  4. D.operation is at its later stages
Show the answer and explanation

Answer: C (some inputs cannot be varied)

Explanation

The short run is the period in which at least one input is fixed and cannot be changed.