Consider the following two rmlevel production functions, both of which exhibit increas ing returns to scale: y, = pm, h,) = Akih, and y,- = am, hi, Y) = Ah. (4) Here It, and h,- are capital and labour which rm 2' chooses to produce its output, 31,-. Y is aggregate output in rm i's industry, which it takes as given. a. Explain the differences between these two production functions from rm is per- spective. b. For the overall economy, the second production function is consistent with a com petitive equilibrium in which the price equals rm i's marginal cost, whereas the rst is not. Why is this