Question

The relationship between output and labor in a model holding capitalstock fixed is known as the:a. aggregate production function.b. long run production function.c. short run production function.d. factors of production.e. effect of capital on the economy.

Answer 1

Answer:

The correct answer is option c.

Explanation:

A production function shows the relationship between the output produced and the inputs employed in the production process.

The short run production function shows the change in the output level when labor changes. In the short run labor is the variable factor, so output can be changed only by making changes in labor. The capital stock will be constant in the short run, so no changes can be made in it.