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2. Flutes (f) and piccolos (p) can be produced in the same firm or in two different firms. If produced in different firms, the cost
2. Flutes (f) and piccolos (p) can be produced in the same firm or in two different firms. If produced in different firms, the cost functions are :C(qr) = qf + 0.5q and C(qp) = 2qp. If produced in the same firm, the cost function is: C(qf, qp) = 5qs + 5qp + Vap + qf. a. If a single firm produces 30 flutes and 30 piccolos, what is the degree of economies of scope? (4 marks) b. Is it more efficient to produce the flutes and piccolos in the same firm or in different firms? Why
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