Consider a privately owned farm with the following production function: L TP 10 1 2 20 29 34560 7 8+ 35 40 42 42 No additional increases in output Assume the market price of output is $10 per bushel, and this price is unaf- fected by total output on this land. Assume all farmers can earn $50 per day in their next best alternative.

a. How many workers will the owner hire on a straight wage contract?

b. Suppose the owner decides to sharecrop the land. How many farmers will the owner employ, and what will be the share taken by the owner?

c. How does your answer depend on the relative costs of these two arrange- ments?