Q1. Labor is a resource that is necessary to produce many goods. "If the price of labor falls," says the economist, "the prices of goods will soon follow." How does this work?

Q2. A manufacturer supplies popular consumer products that use a special cable. The demand is 5000 cables per week. For orders of 1 - 9, the cost is $4 a piece. For orders of 10 - 99, the cost is $3 a piece. For orders 100 - 1900 (100 pieces/case), the cost is $2. For orders of 20 cases (20 case/pallet), the cost is $1.5. The setup cost is $100 per order up to 99. For orders of less than a pallet, the setup cost is $200. The setup cost for pallet loads is $1000. The holding cost is 1% of the purchasing cost per item per week.