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Unformatted text preview: (a) Suppose the price of honey is $2 per unit. How much honey does the farm produce? (b) Suppose the price of apples is $3 per unit. How many apples does the orchard produce? (c) What are the profits of each producer? (d) Suppose the two firms merge. Solve for the quantity of honey and apples produced and the profit of the merged company. ( Hint : Write down the profit function of the merged firm and then differentiate with respect to h and a .)...
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This note was uploaded on 10/26/2010 for the course ECONOMICS ECON 201 taught by Professor Dr.shomubanerjee during the Summer '07 term at Emory.
 Summer '07
 Dr.ShomuBanerjee
 Microeconomics, Externalities

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