Question: A software company in Silicon Valley uses programmers (labor) and computers (capital) to produce apps for mobile devices. The firm estimates that when it comes

A software company in Silicon Valley uses programmers (labor) and computers (capital) to produce apps for mobile devices. The firm estimates that when it comes to labor, MP_L = 5 apps per month while P_L = $1,000 per month. And when it comes to capital, MP_C = 8 apps per month while P_C = $1,000 per month. If the company wants to maximize its profits, it should:

a. Increase labor while decreasing capital.

b. Decrease labor while increasing capital.

c. Keep the current amounts of capital and labor just as they are.

d. None of the above.

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