Suppose That the Cost Function of the Honey Farm Is

question 13

Multiple Choice

suppose that the cost function of the honey farm is C_H(H, A) = H ²/100 - 1A and the cost function of the apple orchard is C_A(H, A) = A²/100, where H and A are the number of units of honey and apples produced respectively.The price of honey is $8 and the price of apples is $6 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 = 175 and A₂ = 300.
• B)A₁ = 150 and A₂ = 300.
• C)A₁ = 300 and A₂ = 350.
• D)A₁ = A₂ = 300.
• E)A₁ = 400 and A₂ = 300.

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Definitions:

Capital

Refers to financial resources or assets owned by a business or individual that are used to generate wealth through investment or production.

Slope

In mathematics and economics, it refers to the measure of the steepness or incline of a line, often representing the rate of change between variables.

Isocost

Lines representing all combinations of inputs that have the same total cost.

Capital

Resources or assets owned by individuals or organizations, utilized to create wealth through investment or production.