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Assuming the production function: Q = 2.5L0.4 K0.6 , a wage rate of $24 and a rental rate of $18.

Assuming the production function: Q = 2.5L0.4 K0.6 , a wage rate of $24 and a rental rate of $18.

a. What is the least costly combination of L and K needed to produce 1000 units? 

b. What is the cost of the bundle found in sub-question a? 

c. What is the least costly combination need to produce 2000 units? 

d. Please illustrate the relationship of L, K, Q in a carefully labelled diagram. (Please use the information from sub-questions a and c) 

e. How would your answer to sub-question a change if the rental rate increased to $24? 

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