Law of variable proportions is applicable in : |
Short run Long run Neither short run nor long run Both short run and long run |
Short run |
The correct answer is Option 1: Short run Law of variable proportions is applicable in Short run because as we increase one factor of production(say, labour), we keep the other factor (capital) constant. In the long run, all factors of production are variable, so the concept of fixed versus variable inputs doesn't apply. |