Conner runs a rafting company on a local river. He runs two kinds of trips a

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Conner runs a rafting company on a local river. He runs two kinds of trips – a wild whitewater experience and a more mellow wildlife tour. If he spends the day only doing whitewater trips, he can do 3 trips per day; if he spends the day only doing wildlife trips, he can do 4 trips. If he does some of each, however, he can do more total trips: 2 whitewater trips and 3 wildlife trips. Suppose that Conner’s time is valued at $20 an hour. What can you say about his economies of scope? That is, what is the sign of his measure of economies of scope, SC?

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Managerial Economics And Strategy

ISBN: 9780134899701

3rd Edition

Authors: Jeffrey M. Perloff, James A. Brander

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