Production in the Short-Run

In the short-run, at least one input is fixed and technology is unchanged during the period. The fixed input(s) may be used to refer to the "size of a plant." Here K is used to represent capital as the fixed input. Depending on the production process, other inputs might be fixed. For heuristic purposes, we will vary one input. As the variable input is altered, the output (Q) changes. The relationship between the variable input (here L is used for "labour") and the output (Q) can be viewed from several perspectives. he short-run production function will take the form Q = f (L), K and technology are fixed or held constant

A change in any of the fixed inputs or technology will alter the short-run production function.

In the short run, the relationship between the physical inputs and output can be describes from several perspectives. The relationship can be described as the total product, the output per unit of input (the average product, AP) or the change in output that is attributable to a change in the variable input (the marginal product, MP).

Total product (TP or Q) is the total output. Q or TP = f(L) given a fixed size of plant and technology.

Average product (APL) is the output per unit of input. AP =TP/L (in this case the output per worker). APL is the average product of labour.

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