An apiary is located next to an apple orchard. The apiary produces honey and the apple orchard produces apples. The cost function of the apiary is СH (H,A) = H² - 2A. 100 The cost function of the apple orchard is CA (H,A) of honey and apples produced respectively. A² 100' = where H and A are the number of units The price of honey is $1 and the price of apples is $3 per unit. (i) If the firms operate independently, how many apples would be produced? (ii) If the firms merged and were operated by a single owner so as to maximize total profit, how many apples would be produced?
An apiary is located next to an apple orchard. The apiary produces honey and the apple orchard produces apples. The cost function of the apiary is СH (H,A) = H² - 2A. 100 The cost function of the apple orchard is CA (H,A) of honey and apples produced respectively. A² 100' = where H and A are the number of units The price of honey is $1 and the price of apples is $3 per unit. (i) If the firms operate independently, how many apples would be produced? (ii) If the firms merged and were operated by a single owner so as to maximize total profit, how many apples would be produced?
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter7: Production, Inputs, And Cost: Building Blocks For Supply Analysis
Section: Chapter Questions
Problem 8TY
Question
the answers are A=150 for question 1 and A=250 for question 2. please show the steps thank you :)
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