Determine the following information in the table for Pat's Pizza Restaurant and answer the questions below.
Marginal Produce of Labor 100
Marginal Product of Capital 4,000
Wage Rate $10
Rental Price of Pizza Ovens $500
1. Is the owner of Pat's Pizza Restaurant minimizing cost?
2. Should he rent more ovens and hire fewer workers or rent fewer ovens and hire more workers? Explain.
3. Determine a firm's production decision in both the short-run and long-run. Discuss what type of input costs might be fixed in the short-run and which might be variable in the short-run. Provide one example of each.