Problem 2 Company B prints books according to the production function q = K, L) = 0.5Lu'5K0'5 where L is labour and K is printing machinery. It costs $10 to hire a unit of Eahour and $50 to rent a unit of machinery. (a) Company B has the Opportunity to take on two new buoks that are estimated to produce $175 and $150 in profit {respectively} if they are taken on. However, to uphold the contracts of these deals the entire set of printing machinery would need to be used for each one, i.e. only one of these deals can be accepted. Additionally, to free up the printing machinery Company B would need to stop printing the bestselling book they are currently printing which brings them 5200 in prot. What is the opportunity cost of the decision to decline both new book offers? (b) What is the isocost line for a budget of $1000 ((7 = 1000)? (c) What is the isoquant equation for Company B? (d) What are the cost minimizing quantities of l. and K? How many units of books will be produced at this cost minimizing point