1. (30 marks) Suppose a firm uses the inputs labour (L) and capital (K) in the production of its output (Q), and the production function is Q = min(L, 2K). (1) Draw the 1soquant curve associated with 12 units of output. Ensure that the vertical axis represents capital and the horizontal axis represents labour. (2) Suppose the wage rate (w) is $2, and the rental price of capital (r) is $4. What is the cost- minimizing combination of labour and capital that produces 12 units of output? Add the isocost line associated with this combination to the graph from (1), and write down the equation for the 1socost line. (3) Suppose the rental price of capital is $2, and output is 12 units. What is the demand curve for labour? Graph your labour demand curve, ensure that the vertical axis represents wage rate and the horizontal axis represents labour. Does your graph suggest that the labour demanded by the firm depends on the wage rate