economics need help

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1.       Suppose a firm has the production technology shown below for Goods 1 and 2 and respond to the following with rationale.


a.       •Does Good 1 indicate economies of scale?

b.      •Does Good 2 indicate economies of scale?

c.       •Do the two goods indicate economies of scope?

          Good 1                              Good 2 Both

Q1       Cost                     Q1         Cost                          Q1                Q2            Cost


10         50                       10          60                             10                  10              100   


20        100                      20         100                            20                  20              180


30        150                      30         130                            30                  30              250



2.       “Grossman’s Model and Risk-Averse” Please respond to the following:


a.       •Analyze Grossman’s Model and how effective this model is at predicting the life expectancy of the elderly. Apply the model to your age group and discuss the findings.

b.      •Correlate the relationship between risk-aversion and the purchase of health care insurance


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