Economies of Scope

Economies of Scope:

1. Apple, a multiproduct firm, produces iPods and iPhones. Suppose the firm’s cost function for iPads (product 1) and iPhones (product 2) was recently estimated as:

Are there economies of scope in producing 10 units of product 1and 10 units of product 2?                                                                                                                      (10 pts.)

***You must show all calculations made in arriving at your conclusion in order to get any credit.