1.Existing empirical evidence indicates that the capital and unskilled labor are gross substitutes.

a.) Based on the information that capital and unskilled labor are gross substitutes, show how the demand curve for capital changes when there is a decrease in the wage paid to unskilled labor.

B.) Based on the information that capital and unskilled labor are gross substitutes, use an isoquant-isocost diagram to show the substitution and scale effects of a decrease in the wage paid to unskilled labor on the firm's optimal use of capital.Please put capital on the vertical axis and unskilled labor on the horizontal axis.