Question 2. Chapter 6. Isoquants and technological progress.Frisbees are produced according to the production function

q=2K + L where

If jeans cost $20 and shoes cost $20, how many will Elizabeth buy of each?

Show your results by graphing the budget constraint and the indifference curve.

Derive Elizabeth's demand function for jeans.

Suppose that her income rises to $300. What will her new demand function be?

q= Output of Frisbees per hourK= Capital input per hour

L= Labor input per hour

1. (5 pt.) If K=10, how muchLis needed to produce 100 Frisbees per hour?
2. (5 pt.) If K=25, how muchLis needed to produce 100 Frisbees per hour?
3. (5 pt.) Graph the q=100 isoquant. Indicate the points on that isoquant defined in part a and
4. part b.
5. (10 pt.) What is the RTS along this isoquant? Explain why the RTS is the same at every point
6. on the isoquant.
7. (5 pt.) Graph the q=50 and q=200 isoquants for this production function also.
8. Suppose technical progress resulted in the production function for Frisbees becoming

q=3K + 1.5L

(15 pt.) Answer part a through part d for this new production function. (5 pt.) Discuss how it compares to the previous case.