=+13.8* Business Application: Switching Technologies: Short Run versus Long Run: In exercise 13.7, we viewed all inputs (including the technology that is chosen) as variable, which is to say we viewed these inputs from a long-run perspective.

A. Now consider the same set-up as in exercise 13.7 but assume throughout that labor is instantaneously variable, that capital is fixed in the short run and variable in the intermediate run, and that the choice of technology is fixed in the short and intermediate run but variable in the long run.