Which of the following statement (s) is/are correct?

Statement 1: In the long run, there is no fixed factor of production.

Statement 2:For any particular production process, long run generally refers to a longer time period than the short run.

Both statements are correct.

The correct answer is Option 3: Both statements are correct.

Explanation:

1. Statement 1: In the long run, there is no fixed factor of production. (Correct). In the long run, all factors of production are variable because firms have enough time to adjust all inputs, such as labor, capital, and land. There are no constraints like in the short run, where some inputs remain fixed.

2. Statement 2: For any particular production process, the long run generally refers to a longer time period than the short run. (Correct). The duration of the long run depends on the industry but is always longer than the short run for any given production process. For different production processes, the long run periods may be different. It is not advisable to define short run and long run in terms of say, days, months or years. We define a period as long run or short run simply by looking at whether all the inputs can be varied or not.