Question Two (30 marks) A firm's product sells for e2 per unit in a highly competitive market. The firm produc using cap

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Question Two 30 Marks A Firm S Product Sells For E2 Per Unit In A Highly Competitive Market The Firm Produc Using Cap 1 (46.26 KiB) Viewed 50 times

Question Two (30 marks) A firm's product sells for e2 per unit in a highly competitive market. The firm produc using capital (which it rents at 75 per hour) and labor (which is paid a wage of e15 per he a contract for 20 hours of labor services). Based on the information provided above am questions that follow: CAPITAL LABOUR TOTAL PRODUCT TOTAL COST (TC) MARGINAL COST (MC) (K) (L) 20 0 20 50 2 20 150 3 20 300 4 20 400 5 20 450 6 20 475 7 20 475 8 20 450 9 20 400 10 20 300 11 20 150 a Solve for total cost and marginal cost respectively (10 marks). b. Identify and explain the fixed and variable inputs (4 marks). c. Calculate the number of units of the variable input to be used to maximize profits (6 d. Calculate and explain the range of the variable input usage where increasing marginal exist (5 marks) e. Calculate and explain the range of the variable input usage that decreasing marginall exist (5 marks)