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All of the analysis just discussed holds in both the long and the short

run. However, if production exhibits constant returns to scale in the long


run, so that the cost function is linear in the level of output, then average
cost, average variable cost, and marginal cost are all equal to each other,
which makes most of the relationships just described rather trivial. But since z* is the optimal choice of the
fixed factors at the output level
u*. we must have
Thus, long-run marginal costs at y* equal short-run marginal costs at
(Y*z, *)

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