Fairfield Company applies manufacturing overhead to products at a predetermined rate of $68 per direct labor hour. Its actual manufacturing costs for the most recent period are summarized here:

Item Description Total Cost

Direct materials Used on Jobs 101 and 102 $ 86,000

Indirect materials Used on multiple jobs 14,600

Hourly labor wages 810 hours @ $34 per hour

180 hours for Job 101

(30 total points) suppose a firm’s production function is given by q = l1/2*k1/2. the marginal product of labor and the marginal product of capital are given by: mpl = 1/ 2 1/ 2 2l k , and mpk = 1/ 2 1/ 2 2k l . a) (12 points) if the price of labor is w = 48, and the price of capital is r = 12, how much labor and capital should the firm hire in order to minimize the cost of production if the firm wants to produce output q = 18?