Which of the following cost functions exhibits economies of scope over the specified output range?
A. C(Q1, Q2) = 10 + 0.5Q1Q2 + (Q1)2 + (Q2)2, for all Q1 < 3 and Q2 < 3.
B. C(Q1, Q2) = 10 + 0.5Q1Q2 + (Q1)2 + (Q2)2, for all Q1 > 2 and Q2 > 2.
C. C(Q1, Q2) = 10 + 3Q1Q2 +(Q1)2 + (Q2)2, for all Q1 > 4 and Q2 > 4.
D. C(Q1, Q2) = 10 + 3Q1Q2 + (Q1)2 + (Q2)2, for all Q1 > 0 and Q2 > 0.
Answer: A
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