Suppose that a firm is operating at a point where MRTS​LK​ = 2, P​L​ = 3, P​K​ = 1. 5.

8. In a diagram measuring labour on the horizontal axis and capital in the vertical axis, draw the point at which this firm operates (label it A), and i. the isoquant curve on which this firm operates, ii. the iso-cost curve on which this firm operates, iii. a possible expansion path for this firm.

9. On the above diagram (the one you used to answer question 8), show i. the intersection point between the expansion path and the above iso-cost curve (label it B), ii. the intersection point between the expansion path and the above isoquant (label it C), and iii. draw the isoquant that passes through point B and the iso-cost curve passing through C.