If it manufactures at home, a firm faces input prices for labor and capital of ŵ and r̂ and produces q̂ units of output using L̂ units of labor and K̂ units of capital. Abroad, the wage and cost of capital are half as much as at home. If the firm manufactures abroad, will it change the amount of labor and capital it uses to produce q̂? What happens to its cost of producing q̂?