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A. Suppose a lawn maintenance firm requires capital and labour to be used in fixed proportions: 1 lawnmower (capital) per 1 unit of labour (worker).

A. Suppose a lawn maintenance firm requires capital and labour to be used in fixed proportions: 1 lawnmower (capital) per 1 unit of labour (worker). Assume it takes a 1/2 a day to abhieve a lawn (1 unit). Show the isoquant for a lawn maintenance firm corresponding to 200 lawns to be mowed.

B. Show the cost-minimizing input combination if a day of labour costs$100, and a lawnmower costs$20 to rent a day, and the firm wants to mow 200 lawns.

C. Depict the scale and substitution effects if the wage decreases to $50 per day.

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