In Problem 2, Suppose That the Cost Function of the Honey

question 14

Multiple Choice

In Problem 2, suppose that the cost function of the honey farm is C_H(H, A) = - 3A and the cost function of the apple orchard is C_A(H, A) = , where H and A are the number of units of honey and apples produced respectively. The price of honey is $7 and the price of apples is $5 per unit. Let A₁ be the output of apples if the firms operate independently, and let A₂ be the output of apples if the firms are operated by a profit-maximizing single owner.

• A) A₁ = 125 and A₂ = 250.
• B) A₁ = A₂ = 250.
• C) A₁ = 200 and A₂ = 250.
• D) A₁ = 250 and A₂ = 400.
• E) A₁ = 350 and A₂ = 250.

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Definitions:

Slave Sales

Transactions involving the buying and selling of individuals as property, a central element of the slave system in historical contexts.

Family Units

Social groups consisting of parents and their children, considered as a basic unit in society for educating children and providing emotional and financial support.

Compromise of 1850

A series of congressional laws intended to settle the issues arising from the expansion of slavery into new territories, aiming to ease tensions between the North and South.

Kansas-Nebraska Act

Legislation passed in 1854 that allowed the territories of Kansas and Nebraska to decide for themselves whether or not to allow slavery within their borders, leading to violent conflict.