Dakota Inc. is a medium-sized footwear manufacturer. Its CEO is concerned about cost control and feels that both direct and indirect costs can be reduced to increase profit margins. There is, however, significant resistance to cost-cutting measures from the unions that represent Dakota's 200-strong workforce. Dakota's salespeople are keen on any cost reduction which could lead to a cut in prices and the chance to increase sales. 

1. Define the term Capital Expenditure and give an example that is relevant for Dakota. 

2. State two examples of direct costs Dakota would have.

3. Explain why overhead/indirect costs are often considered to be fixed costs. 

4. Analyse two problems Dakota might encounter when trying to reduce its direct labour cost.