.Answer the following given the information below and Product price $2.50, Labor cost = $15, Capital cost = $20, Fixed Cost = $65. %3D %3D There are how many Least Cost Combinations of resources What is the Profit Maximizing Combination? Units of Labor ,Units of Capital What is the Profit Maximizing quantity of product? What is profit/loss? Total Units of Product Units of Product Total Labor (Q) Capital (Qc) MP/ PL MPc / Pc MRPI PL MRPC/ Pc $3.38 1.350 1.000 18 1 27 1.200 $3.00 2 33 2 47 1.000 $2.50 $2.50 42 62 0.600 0.750 $1.50 $1.88 $1.50 $1.00 4 48 4 74 0.400 0.600 $1.00 49 82 0.067 0.400 $0.17

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.