y bar= K^2 L^.5

a. Solve the contractors problem given a general input-cost-function

b. Calculate the optimal combination of inputs.

c. Calculate the firms cost function (plug K* and L* into objective function and solve for

C(Y)).

d. What would it cost to produce Y bar= 100 ? How much labor and capital are needed assuming that w=r=$1

Now suppose that y bar=? 8K^2 L^.5 due to a technological discovery.

e. Illustrate the change on the production function in general, you don’t need numbers.

f. Solve for the new cost function.

g. Repeat part d.