Question 1: demonstrate if the following cost function exhibits economies of scope (10 points)

C(Q1, Q2) = 500 - 2Q1Q2 + (Q1)2+ (Q2)2

Question 2 (15 points): For the cost function TC = 200 + 4Q + 2Q^2 , with Q = 5, determine

a. Fixed cost (2 points)

b. Average fixed cost (2 points)

c. Variable cost (2 points)

d.average variable cost (2 points)

e. Total cost (2 points)

f.Average total cost (2 points)

g. Marginal cost (3 points)

Question 3: (25 points) Consider a monopolist producing and selling a product with the demand curve: P =30 - 6Q

The firm's total cost function is TC = 14 + 3Q + 3Q^2

Determine

a. optimal level of output (10 points)

b. price of the product (10 points)

c. firms profits. (5 points)