1. Please answer clearly Suppose that a single firm is both a monopolist and a monopsonist. This
firm purchases two inputs, K&L, and combines them to produce Q. This firm pays the price pL
for each unit of L and the price pK for each unit of K. This firm sells Q for a price p. The firm
has no semi-fixed costs. The Demand for Q is given by: Q=402p The Supply of L and K is given
by: pL=0.5LpK=0.25K And this firm's production function is given by: Q=K0.5L0.5 Given the
above, answer the following questions: 8) What is this firm's profit function as a function of
K&L ? [1 point] 9) Use cost minimization to determine the cost-minimizing choices of K&L as
functions of Q. Hint: Cost Minimization is for a given Q] [3 points] 10) What is the Cost
Function of this firm as a function of Q ? [1 point] 11) Finally, what is this firm's profit-
maximizing choices of K,L, and Q ? [3 points]