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Homework Help: Microeconomic theory

  1. Mar 5, 2008 #1
    1. The problem statement, all variables and given/known data[/b
    Firm XYZ produces widgets using two plants. True or False: "It should allocate its production between the plants so that the average cost of a widget is the same in the two plants."


    2. Relevant equations



    3. The attempt at a solution

    Ive looked at different cost graphs and theories, ive looked up allocation and found one theory that allocating helps produce the most favorable outcome. But I need help with good reasoning to explain why its true or false.
    If anyone would like to help on this I would appreciate it thank you.
     
  2. jcsd
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