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The economies of scale index can be defined as S= AC/MC. Suppose each firm's cost function can be given as TC= 400 + 5q 2
The economies of scale index can be defined as S= AC/MC. Suppose each firm's cost function can be given as TC= 400 + 5q2. At what approximate value (rounded to the nearest integer) of q would the scale economy index equal one?
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