QUESTION 3

Part A: You are a consultant for an electronics company that has incurs of a cost of capital of $500 and currently pays its workers a wage of $22 per hour. The marginal product of capital is 50 units per hour and the marginal product of labor is 10 units per hour. With reason and showing any necessary working, explain the recommendations of cost minimization that you would give to this company.

Part B: Your company, P&G, is a large brand management company that is one of top companies in the country. It is currently producing at a point on its long-run average cost curve with economies of scale.

An opportunity has risen where, as the owner, you can enter a long-term, fixed-price agreement or contract for your products. This would significantly increase the size of your firm. If you sign the contract and do not expect the prices of your inputs to change, would your profits be larger in the short run or the long run? Clearly give the reason for your answer.

Part C: Explain the reason for shape of the average fixed cost and the average total cost curves.

Plz answer a b c explaain

Dont answer by pen pepar