Information About

Short-term

A generic firm can make three changes in the short-run:

Increase production

Decrease production

Shut down

In the short-run, a Profit Maximizing firm will:

Increase production if Marginal Cost is less than Price ;

Decrease production if Marginal Cost is greater than Price ;

Continue producing if Average Variable Cost is less than Price , even if Average Total Cost is greater than Price ;

Shut down if Average Variable Cost is greater than Price . Thus, the Average Variable Cost is the largest loss a firm can incur in the short-run.

SEE ALSO

Long-run

IN PRINTING

A short run is slang for "a small order." Short runs sizes are different for the various sections of the printing industry (print media, screen printing, silk screening, etc). In most sectors, there are certain printers that specialize in short runs.