X Gardens and Lawns provides lawn and gardern care to apartment buildings an office complexes. Use the information in the table below to answer the questions.

Labour (workers per day) Output

# Building Grounds serviced per day.

1 2

2 5

3 9

4 12

5 14

6 15

1. Calculate the marginal product and average product for each level of labour.

2. The firm leases gardening equipment for $200 per day and pays workers $120/day use this information to answer the questions below.

a. Calculate the total cost, total variable cost, and total fixed costs for each level of output.

b. Calculate the average total cost (ATC), average fixed cost (AFC), average variable cost(AVC) and the marginal cost (MC) for all the output levels. (Put this information in a table).

3. The cost of gardening equipment increases to $300 per day with no change in the daily payment to workers.

a. What costs will increase? Please just state the type of costs affected.

b. Calculate the ATC, AFC, AVC, and MC using the new information. (Put this information in a table)

c. What costs did not change and why?

4. The cost of leasing gardening equipment goes back to $200 per day but the daily rate for workers increases to $150 per day.

a. Calculate the ATC, AFC, AVC and MC using the new information. (Put this information in a table)

b. What costs did not change and why?

c. Has the marginal product or average product changed or the workers? Why or Why not?