Question

For Sue's candy, the total cost of producing chocolates, k and frosting, f, jointly is given by

TC = 100 + 50kf – (kf)^0.5.

The total cost of producing k and f in two different factory locations is given by

TC = 75 + 3,000k + 1,000Q₂ + k² + f².

If the firm produces k = 40 and f = 100, then how much more expensive or cheaper in percentage terms is it to produce together?

Q_{2 is not given anywhere else in the question so I am not sure if this question is answerable, but if anyone has ideas as to what it could be, that would be helpful}

Answer 1