An apiary is located next to an apple orchard. The apiary produces honey and the apple orchard produces apples. The cost function of the apiary is C_H(H, A) = - 2A and the cost function of the apple orchard is C_A(H, A) = , where H and A are the number of units of honey and apples produced respectively. The price of honey is $1 and the price of apples is $3 per unit. Let A₁ be the output of apples if the firms operate independently, and let A₂ be the output of apples if the firms are operated by a single owner so as to maximize total profit. A) A₁ = 75 and A₂ = 150. B) A₁ = A₂ = 150. C) A₁ = 125 and A₂ = 150. D) A₁ = 150 and A₂ = 250. E) A₁ = 50 and A₂ = 150.

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The Answer of An apiary is located next to an apple orchard. The apiary produces honey and the apple orchard produces apples. The cost function of the apiary is C_H(H, A) = - 2A and the cost function of the apple orchard is C_A(H, A) = , where H and A are the number of units of honey and apples produced respectively. The price of honey is $1 and the price of apples is $3 per unit. Let A₁ be the output of apples if the firms operate independently, and let A₂ be the output of apples if the firms are operated by a single owner so as to maximize total profit. A) A₁ = 75 and A₂ = 150. B) A₁ = A₂ = 150. C) A₁ = 125 and A₂ = 150. D) A₁ = 150 and A₂ = 250. E) A₁ = 50 and A₂ = 150.

An Apiary Is Located Next to an Apple Orchard