**4.1 Short run vs. long run**

We first need to distinguish between the "short-run" and "long-run." However, how short is short, and how long is long? In the study of economics, the short run and the long run do not refer to a specific period, such as 3 months versus 3 years. Instead, they depend on the number of variable and/or fixed inputs that affect the production output [4].


Here, we assume that capital is fixed, while labor is variable. Extra shifts, overtime, and hiring can be relatively easily arranged when more labor is needed. However, it will not be able to employ more capital in the same time frame as capital acquisition takes time.
