Guido's Pizza sells pizzas in Plainview. The production function for Guido's Pizza is given by the following:1 1 4 4 ( , ) 20Q f L K L K where L represents man-hours, K represents machine hours and output Q is measured in pizzas sold per day. The price of an hour of labor is $25 and the price of an hour of machine time is $16. a) Given the input prices and the production function set up the cost minimization problem. Solve the cost minimization problem to determine the (compensated) factor demands for labor and machines. Finally use the factor demands to show that the cost of the least-cost input bundle 0.1Q2. In addition to labor and capital costs, Guido's pays material costs equal to $4 per pizza and has fixed costs of $90 per day. Thus the total cost curve is C(Q) = 0.1Q2 + 4Q + 90 b) What is the average cost curve of Guido's Pizza? What is the marginal cost curve of Guido's Pizza? Illustrate the two cost curves in a diagram. c) For what values of Q do Guido's Pizza's cost curves exhibit "scale" economies? Guido's Pizza's is a non-competitive firm. Inverse demand for Guido's pizzas in Plainview is given by P = 40- 0.8Q. d) Given its cost curve and firm demand, how many pizzas will Guido's Pizza sell? What price will it charge? What is the average cost of a pizza at the profit maximizing quantity? e) In your diagram for part (b) illustrate the demand curve and marginal revenue curve for this market. Indicate the profit maximizing price and quantity that you found in part (d). f) In your diagram for part (b) illustrate the profits of Guido's Pizza at the profit maximizing price and quantity. Suppose that the demand for Guido's pizzas falls to P = 22 - 0.8Q. g) How many pizzas will Guido's sell now? What price will it charge? What is the average cost of a pizza at the profit maximizing quantity? h) Redraw your cost curve from part (b) below. Illustrate the new demand curve and marginal revenue curve. Indicate the profit maximizing price and quantity that you found in part (g).