Short Run and Long Run Costs
Short Run Costs: The short run costs are operating costs associated with the change in output. In the short run, the production function contains a set of fixed factor input and a set of variable inputs. Short run costs vary in relation to the variation in the variable input component only.
Long Run Costs: The long run costs are the operating costs associated with the changing scale of output and the alteration in the size of plant. In the long run production function all the factor inputs are variable. Their costs are the long run costs.
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Project Time Cost Trade-off Project Time Cost Trade-off Project Time Cost Trade-off Project Time Cost Trade-off