<P> The long run is a planning and implementation stage . Here a firm may decide that it needs to produce on a larger scale by building a new plant or adding a production line . The firm may decide that new technology should be incorporated into its production process . The firm thus considers all its long - run production options and selects the optimal combination of inputs and technology for its long - run purposes . The optimal combination of inputs is the least - cost combination of inputs for desired level of output when all inputs are variable . Once the decisions are made and implemented and production begins, the firm is operating in the short run with fixed and variable inputs . </P> <P> All production in real time occurs in the short run . In the short run, a profit - maximizing firm will: </P> <Ul> <Li> increase production if marginal cost is less than marginal revenue (added revenue per additional unit of output); </Li> <Li> decrease production if marginal cost is greater than marginal revenue; </Li> <Li> continue producing if average variable cost is less than price per unit, even if average total cost is greater than price; </Li> <Li> shut down if average variable cost is greater than price at each level of outputs </Li> </Ul> <Li> increase production if marginal cost is less than marginal revenue (added revenue per additional unit of output); </Li>

Which of the following factors of production are fixed in the long run