MedM, Inc. uses capital and labour to produce high quality medical equipment. The various combinations of hours of capital use (K) and hours of labour use (L) needed for production are described by the following production function: q = f(K, L) 1 K + 12/10 L. 20 (In the unlikely case that your computer cannot read the expression above properly, here it is again: q = f(K,L) = {sqrt(K) + sqrt (L)}/20. Note that the corresponding isoquants have typical, downward-sloping, convex shape. The company can rent capital for $20 dollars per hour and hire all the workers it wants at $60 dollars per hour. a) [5 points] What are the cost minimising capital and labour inputs for MedM, Inc. in order to produce q units of output? Illustrate on a graph with an isoquant and isocosts. Put labour on a horizontal axis. b) [2 points] Derive an expression for the output expansion path and draw the path on a graph with isoquants and isocosts. c) [3 points] Given you answer to a), find the long run cost function CLR(q). Calculate the corresponding marginal cost function MCLR(q). Sketch cost and marginal cost functions on separate graphs.