4)(15 pts) (Specific-Factors Model) Use the following information to answer the questions below.

Computers

sales revenue = Pc.Qc=150

Payments on labour = w.Lc=75

Payemnts on Capital =Rk.K=75

Barley

sales revenue Pa.Qa=150

Payments on labour w.La=70

Payemnts on CapitalRt.T=80

Holding the price of computers constant, suppose the percentage increase in the price of barley is 10% and the percentage increase in wages is 5%.

a.Determine the impact of the increase in the price of barley on the rentals on land.

b.Determine the impact of the increase in the price of barley on the rentals on capital.

c.How would the increase in the price of barley effect labor?