Does the firm possess economies of scope


Solve the below problem:

Q: Suppose a firm produces two goods and has the cost function, TC = 15Q_1 + 15Q_2 (the quantities of the two goods are given by Q_1 and Q_2).

Does the firm possess economies of scale in the production of good 1?

What is the average incremental cost for good 1 when Q_1 = 10 and Q_2 = 10?

Does the firm possess economies of scope?

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Operation Management: Does the firm possess economies of scope
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