2. (10.4) The firm's production function is q=2(kl)1/2. In the short-run, k=100 is fixed. v=$1 and w=$4. a. Calculate short-run total cost and short-run average cot. b. Calculate short-run MC. What are SC, SAC and SMC for q=25? For q=50? For q=100? For q=200? c. Graph SAC and SMC. Show points of part (b). d. Where does the SMC curve cross SAC curve? Why does SMC always cross SAC at its lowest point? Suppose now amount of capital is fixed at k in the short run. e. Calculate total cost as a function of q, w, v and k. f. Given q, w and v, how should k be chosen to minimize total cost? g. Use results from (f) to calculate long-run total cost of q. h. For w=$4, v=$1, graph the long-run total cost. Show that this is an envelope for the short- run curves computed in part (e) by examining values of k of 100, 200, and 400. 2. (10.4) The firm's production function is q=2(kl)1/2. In the short-run, k=100 is fixed. v=$1 and w=$4. a. Calculate short-run total cost and short-run average cot. b. Calculate short-run MC. What are SC, SAC and SMC for q=25? For q=50? For q=100? For q=200? c. Graph SAC and SMC. Show points of part (b). d. Where does the SMC curve cross SAC curve? Why does SMC always cross SAC at its lowest point? Suppose now amount of capital is fixed at k in the short run. e. Calculate total cost as a function of q, w, v and k. f. Given q, w and v, how should k be chosen to minimize total cost? g. Use results from (f) to calculate long-run total cost of q. h. For w=$4, v=$1, graph the long-run total cost. Show that this is an envelope for the short- run curves computed in part (e) by examining values of k of 100, 200, and 400