3. Jobs Boost as Lidl Unveils Plans for £20m Warehouse Expansion
The German supermarket giant Lidl has plans to expand its distribution centre in County Antrim and open additional stores across Northern Ireland. The company is already recruiting new employees to facilitate its growth and expansion plan. Throughout the build, it could be employing more than 100 construction workers as well.
Source: Belfast Telegraph, June 12, 2015
a. Which of Lidl’s decisions described in the news clip is a short-run decision and which is a long-run
decision?
b. Why is Lidl’s long-run decision riskier than its short-run decision?

Lidi

a. Lidi's decisions:

1. short-term decision: The company is already recruiting new employees to facilitate its growth and expansion plan.

2. long-term decision: The German supermarket giant Lidl has plans to expand its distribution centre in County Antrim and open additional stores across Northern Ireland.

Throughout the build, it could be employing more than 100 construction workers as well.

b. Lidi's long-run decision is riskier than its short-run decision because increased uncertainty is involved in the long-run decision than in the short-run decision.

Explanation:

Short-run decisions are the decisions by Lidi that are current, usually within a year's horizon or covering a short period of about 12 calendar months.  The long-run decisions are projections for the future, which are always shrouded with uncertainties because it difficult to predict with precision what happens in the long-run.

answer; break-even analysis;