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A multiproduct firm's cost function was recently estimated as: C (Q1, Q2) = 90 0.50 Q1Q2 + 0.40 Q12 + 0.30 Q22 a. Are there
A multiproduct firm's cost function was recently estimated as: C (Q1, Q2) = 90 0.50 Q1Q2 + 0.40 Q12 + 0.30 Q22 a. Are there economies of scope in producing 10 units of product 1 and 10 units of product 2? b. Are there cost complementarities in producing products 1 and 2? c. Suppose the division selling product 2 is floundering and another company has made an offer to buy the exclusive rights to produce product 2. How would the sale of the rights to produce product 2 change the firm's marginal cost of producing product 1
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