Consider a version of the manufacturing bid-rent curve, but with two sectors. Let x1 and x2 be the distance that firms in sector 1 and sector 2 locate away from the city center. Firms face freight, labor, and land costs — but no intermediate goods cost. To simplify the algebra, lets also assume that firms in each sector use only oneunit of land (and thus the land cost, LC(xi) =P(xi) for i= 1,2. The labor costs for each firm(as a function of distance to center) is given by:
L(x1) = 20−A1∗x1
L(x2) = 30−A2∗x2
The freight costs for each firm as a function of distance is given by
F(x1) = (B1+ 3)∗x1 F(x2) = (B2+ 3)∗x2 use your answer from part a to derive the bid-rent curves for manufacturing firms in each sector.