Suppose a firm has the following production function: Q = 2KL. The marginal product of capital for this production function is 2L, and the marginal product of labor is 2K. If capital rents for $100 per unit per day, labor can be hired for $200 per unit per day, and the firm is minimizing costs, a. Find the total cost of producing 60 units of output b. Suppose you want to determine the cost of producing the more general q units of output. Using the same set of procedures you followed in (a), but a more general q instead of 60, find this firm’s total cost function, which expresses total cost as a function of q. c. Divide the total cost function you found in (b) by q to determine this firm’s average cost function.
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