Target Exam

CUET

Subject

Economics

Chapter

Micro Economics: Production and Costs

Question:

Law of variable proportions is applicable in :

Options:

Short run

Long run

Neither short run nor long run

Both short run and long run

Correct Answer:

Short run

Explanation:

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.