Cost & Revenue Analysis... Continued

There are typically two types of variables in the production process. Variable inputs vary with output while fixed inputs are those that do not change with output (at least in the short run). A short run is a period of time when the quantities of some inputs are fixed (typically capital) while the quantities of others are variable (typically labor & raw materials). A long run is a period of time when all  input quantities  may be varied, such as an increase in plant size. In the long run, all inputs are variable (need to change plant size) as illustrated in Table 3.1 and Figure 3.1 below.