Problem
Consider the following information in the table for Pat's Pizza Restaurant and answer the questions below by using the cost minimization rule that takes into account the marginal product per dollar of inputs of production.
1. Is the owner of Pat's Pizza Restaurant minimizing costs? Explain using the data in the table.
2. Should he rent more ovens and hire fewer workers or rent fewer ovens and hire more workers to increase productivity and lower costs of production? Explain.
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Marginal Product of Capital
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4,000
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Marginal Produce of Labor
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100
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Wage Rate
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$10
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Rental Price of Pizza Ovens
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$500
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The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.