Assuming the price per unit of Capital is $3.00 and the price per unit of Labor is $5.00---create a cost schedule showing fixed, variable, total and marginal costs for each level of output.

Table 1. Schedule of Inputs and Outputs

Labor Capital Output

0 100 0

5 100 1

12 100 2

21 100 3

32 100 4

45 100 5

Once that is done, use the information to create an average cost schedule (i.e., Table) conveying the following for each level of output: Average Fixed Cost, Average Variable Cost, and Average Total Cost. Finally, plot the average costs and the marginal costs you calculated earlier on the same graph. In addition to labeling the curves, be sure to put cost on the vertical axis and output on the horizontal axis. Along those lines, plot the marginal costs at the midpoint of the intervals between output levels (i.e., .5, 1.5, etc.).