Answer» | Short term (run) | Long term (run) | | 1. A short term (run) is a time period in which a producer cannot change factors of production. | 1. A long term (run) is a time period in which a producer can change all the factors of production. | | 2. In this period all the factors of production such as plant, heavy machinery, building of a factory, etc. remain fixed. | 2. In this period all the factors of production such as plant, heavy machinery, building of a factory, etc. are variable. | | 3. The producer can increase/decrease production by increasing or decreasing variable factors such as raw material, labour, electricity, etc. | 3. The producer can increase or decrease factors of production and hence increase/decrease the production. |
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