3) Using isocost and isoquant curves, show a rm's optimal quantities of high skilled labor and low skilled labor. 4 Next, suppose two things happen. First, the firm has a larger budget (so you need a new isocost curve). Second, technological inventions make high skilled labor more productive. Show how this will create a new isoguant curve with a different slope. What happens to the slope of the isoquant curve (did it get atter or steeper)? Next, show the isoquant curve that maximizes output given that the rm is operating on the new isoquant curve). Show the old and new optimal combinations of high and low skilled labor. Identify how the technological improvement changes the percentage of labor hired that is low skilled labor. Explain everything and show everything graphically. Table 2: Firm B Produce Do not Produce Firm A Produce 10,10 16,13 Don't Produce 13,16 7,7 Payoffs: A, B