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4. (Module 72) Theo employs labor at a competitive wage (W) of $3 per unit, and he employs capital at a competitive rental rate (R)

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4. (Module 72) Theo employs labor at a competitive wage (W) of $3 per unit, and he employs capital at a competitive rental rate (R) of $6 per unit. a. State the cost-minimizing rule. You must provide both a written statement of it, and state it as an equation. b. At Theo's current combination of labor and capital, the marginal product of labor (MPL) is twice as large as the marginal product of capital (MPK). Is Theo currently employing the optimal ratio of labor and capital? If not, how should he adjust his hiring of labor and/or capital? Explain. (5 points)

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