Inputs are variable
Definition
Inputs are variable refers to the resources or factors of production that can be adjusted or changed in quantity based on the needs of a firm. These inputs include labor, capital, and raw materials.
Analogy
Think of inputs as ingredients in a recipe. Just like you can adjust the amount of flour, sugar, or eggs in a cake recipe depending on how many cakes you want to make, firms can adjust their inputs based on how much output they want to produce.
Related terms
Fixed inputs: Fixed inputs are resources that cannot be easily adjusted in the short run, such as factory space or specialized machinery.
Marginal product: Marginal product is the additional output that is produced when one more unit of input is added while keeping other inputs constant.
Total cost: Total cost is the sum of all costs incurred by a firm in producing a certain level of output, including both fixed and variable costs.
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