A manager hires labor and rents capital equipment in a very competitive market. Currently the wage rate is $10 per hour and capital is rented at $12 per hour. If the marginal product of labor is 40 units of output per hour and the marginal product of capital is 70 units of output per hour, should the firm increase, decrease, or leave unchangedthe amount of capital used in its production process?

The firm should decrease capital.