A firm's production function is characterized by the following production function: Q=L^(1/2)K^(1/4) Suppose the input prices are w = 1 and r=4 and the firm wishes to produces 8 units of output. a.What kind of returns to scale is the firm experiencing? Briefly explain b.Find the cost-minimizing input bundle using the Lagrangian method.

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Isocost and Isoprofit Curve Analysis

An isocost curve in the production theory that is a crucial part of economics depicts different combinations of factor inputs at a given market cost. In other words, this shows all the combinations of production factors that cost the same for the firm to employ. Usually, this can be depicted as a downward sloping straight line when the firms act as the price-takers in the factor markets. The slope of this mainly depicts the relative prices of different production factors.