Suppose a firm has the production technology shown below for Goods 1 and 2 and respond to the following with rationale. Does Good 1 indicate economies of scale? Do the two goods indicate economies of scope? Does Good 2 indicate economies of scale? Good 1 Good 2 Both Q1 Cost Q1 Cost Q1 Q2 Cost10 50 10 60 10 10 100 20 100 20 100 20 20 18030 150 30 130 30 30 250
