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You have been hired to replace Eric, the manager of a firm that used only two inputs, capital and labor, to produce output. The firm

You have been hired to replace Eric, the manager of a firm that used only two inputs, capital and labor, to produce output. The firm can hire as much labor as it wants at a wage of $10 per hour and can rent as much capital as it wants at a price of $70 per hour. .As you begin to review the company's production information, you learn that the company has been using capital and labor in amounts that imply a marginal product of labor of 70 and a marginal product of capital of 100. What do you think Eric could have done to keep his job?

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