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- Show a LRAC curve that exhibits only increasing returns to scale. In the same graph draw the corresponding LRMC curveWhy are the MC and MP inversely related to one another? While it is because as one increases, the other decreases, please explain the meaning behind the inverse relationship that exists between worker productivity and cost, in general.Prof. Smith and Prof. Jones are going to produce a new textbook. The production function for the book is: ?=?1/2?1/2?= is the number of pages in the finished book?= is the number of working hours spent by Smith?= is the number of working hours spent by JonesSmith's labor is valued at 3 TL per working hour and Jones's labor is valued at 12 TL per working hour. After having spent 900 hours preparing the first draft, Smith cannot contribute any more to the book. Jones will revise the Smith's draft to complete the book.a) How many hours will Jones have to spend to produce a finished book of 300 pages?b) What is the marginal cost of the 300th page of the finished book?
- if the ATC curve is rising, does that mean the MC curve must lie above it? Explain.Graph AFC, AVC, ATC, and MC. Explain the derivation and shape of each of these four curves and their relationships to one another. Specifically, explain in nontechnical terms why the MC curve intersects both the AVC and the ATC curves at their minimum points.Solve Consider the following
