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Question: Let f (x_1, x_2) = 2x^0.5 _1 x^0.3 _2 + 0.0001x^2 _1 x^2 _2 Find the short run average cost curve...

Show transcribed image text Let f (x_1, x_2) = 2x^0.5 _1 x^0.3 _2 + 0.0001x^2 _1 x^2 _2 Find the short run average cost curve for x_2 = 1, 1.5, 2, 2.5, 3 Find the long run average cost curve. (b) Let c (y_1, y_2) = y_1 + y_2 + (y_1 y^2) 1/3 Does this cost function have economies of scale for y_1 ? What about economies of scope for any strictly positive y_1 and y_2 .Economies of scale exist if for a positive set of y_1 and y_2, c (y_1, y_2) > c (y_1, 0) + c (0, y_2)

Let f (x_1, x_2) = 2x^0.5 _1 x^0.3 _2 + 0.0001x^2 _1 x^2 _2 Find the short run average cost curve for x_2 = 1, 1.5, 2, 2.5, 3 Find the long run average cost curve. (b) Let c (y_1, y_2) = y_1 + y_2 + (y_1 y^2) 1/3 Does this cost function have economies of scale for y_1 ? What about economies of scope for any strictly positive y_1 and y_2 .Economies of scale exist if for a positive set of y_1 and y_2, c (y_1, y_2) > c (y_1, 0) + c (0, y_2)