For each of the following situations:

i) derive the Total Cost Function, TC(q), (4 points)

ii) draw the isoquant for the given level of output, (2 points)

iii) draw the isocost associated with the minimum Total Cost of producing the given amount of output, (2 points)

iv) identify the cost minimizing amount of Labor and Capital (L* and K*), (2 points) and

v) label your graph carefully and accurately. (1 point)

A.

• Production Function: q = 3*MIN(L, 3K)
• Input prices: w = 6, r = 9
• q = 18