Calculation of Average Costs with Economies of Scope Baby Supplies

question 109

Multiple Choice

Calculation of Average Costs with Economies of Scope Baby Supplies is considering a merger with Tot Toy Stores.Baby's total operating costs of producing services are $450,000 for sales volume of $2.15 million.Tot's total operating costs of producing services are $250,000 for a sales volume (J_P) of $975,000.Calculate the average cost of production for the Baby and Tot Toy firms,respectively.

• A)11.63 percent, 20.93 percent
• B)20.93 percent, 25.64 percent
• C)46.15 percent, 11.63 percent
• D)22.4 percent, 22.4 percent

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