Question: 1. A firm has the following production function q = (k3/4 l1/2). It aims to produce 200 units of output and faces prices for labor

1. A firm has the following production function q = (k3/4 l1/2). It aims to produce 200 units of output and faces prices for labor and capital as follows: w =6, v =2. (8 marks)

a) Form the Lagrangian Function for the cost minimization problem. (1)

b) Find the cost-minimizing bundle of labor and capital, (k*, l*). (5)

c) Show this cost-minimizing level of inputs in a diagram. (2)

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