Manufacturing: Sales revenue = P * Q= $150 Payments to Labor = W *L. = $ 100 Payments to capital = R * K =
Manufacturing: Sales revenue = P * Q= $150 Payments to Labor = W *L. = $ 100 Payments to capital = R * K = $ 50 Agriculture: Sales Revenue = P * Q = $ 150 Payments to labor = W* L.= $ 50 Payments to capital = R *T= $ 100 Suppose Py rises by 10% and Wrises by 5%. What are the effects on rental capital and land? Are capital owners or/and land owners better off or worse off? Explain
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