
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
expand_more
expand_more
format_list_bulleted
Question

Transcribed Image Text:Use the orange points (square symbol) to plot Aliyah's total cost curve on the following graph using the quantities from the preceding table.
200
180
160
TOTAL COST (Dollars)
140
120
100
80
60
40
40
00
20
0
0
25
50
75 100 125 150 175 200
225 250
QUANTITY OF OUTPUT (Pizzas)
-0-
Total Cost
(?)
The law of diminishing marginal product of labor is demonstrated by which of the following?
O Total output declines as you increase the quantity of labor.

Transcribed Image Text:Aliyah's Pizzas is a takeout-only pizza parlor servicing the college campus of Tallahassee that specializes in vegan pizzas. Aliyah's small shop has
barely enough room for customers to stand and wait, let alone the four pizza ovens necessary to keep up with the hungry student customers. Aliyah
signed a lease renting both the four ovens and the storefront for the next year. Due to the terms of the lease and the building's size constraint, Aliyah
is unable to change the store's number of pizza ovens in the short run.
However, Aliyah does face a decision regarding the number of employees to schedule on a weekly basis. Every Sunday, Aliyah contacts the staff to
communicate the amount of workers needed on each day of the upcoming week. In the short run, the store employees are
pizza ovens are
inputs.
inputs, and
The following table presents Aliyah's daily production schedule.
Fill in the blanks to complete the Marginal Product of Labor column for each worker.
Labor
Output
Marginal Product of Labor
(Number of workers)
(Pizzas)
(Pizzas)
0
0
1
80
2
150
3
200
4
220
AAAAA
5
230
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by stepSolved in 2 steps with 1 images

Knowledge Booster
Similar questions
- Given the number of labor and the total product in the following table, 1- find the average product (APL) and marginal product (MPL) of labor. 2- Draw Total product (TP), average product (AP) and marginal product (MP) of labor curvesarrow_forwardConsider the production function from earlier: Quantity of Haircuts 20 15 10 0+0 0 N 2 8 14 O Increasing marginal productivity O Constant marginal productivity O Decreasing marginal productivity 3 19 23 Labor (hours) 27 26 Total Product Curve From 1 labor hour up to 7 labor hours, what sort of marginal productivity does this production function have?arrow_forwardThe table below shows data for the production of Avocados for an individual firm. Number of workers Number of Avocados 0 0 1 70 2 126 3 168 4 196 5 210 Given this data, what is the marginal product of labor when quantity increases from 1 by one unit?arrow_forward
- 1. What should the firm do if the marginal product obtained from the last dollar spent on capital is smaller than the marginal product derived from the last dollar spent on labor and why? Graphically illustrate.arrow_forward.2. Tiva has a crafts store that makes jewelry using beads (B) and copper (C). Her productionfunction for jewelry is given byQ = B0.4C0.4Suppose she can buy beads and copper at prices PB and PC, respectively.(a) Calculate Tiva’s marginal rate of technical substitution between B and C.(b) Does this production function have increasing, constant, or decreasing returns to scale?Explain. (c) Set up the cost minimization problem you would use to calculate Tiva’s cost functionC(Q) in Lagrangian form. (Note: You do not need to solve it or derive first orderconditions.Suppose Tiva decides to branch out in her jewelry offerings by getting a 3D printer. The costof producing new 3D printed jewelry isC(Q) = 25 + Q24For the rest of this problem, assume Tiva can produce fractions of jewelry, don’t worry aboutrestricting your answers to whole numbers.(d) Compute Tiva’s marginal cost and average cost of production for 3d printed jewelry.(e) Explain why she will shut down when the market price falls…arrow_forwardCon Co. produces a collectible card game. Currently, the price of capital is at $50 and the price of labor is at $10. The marginal product of capital is 200 and the marginal product of labor is 30. To minimize cost of the given output, Con Co. should Use more capital Use more capital and labor Leave capital and labor as is Use more laborarrow_forward
- Output per month Figure 6.1 A B C D E Labor per month Refer to Figure 6.1. At which point on the total product curve is the average product of labor the highest?arrow_forwardI have graphed the isoquant line but I can’t figure out how to graph the isocost line? Could you verify my math and show the isoquant and isocost line graphed please?arrow_forwardASAP!! ANSWER PLEASE Hammas Dadani operates a business and uses the following table for total output or total product as a function of labor units used. LABOR TOTAL OUTPUT 0 0 1 5 2 9 3 12 4 14 5 15 Calculate Marginal Product of Labor and Average Product of Labor? Plot a graph for total product, marginal product and average product separately? Does the graph indicate a situation of diminishing returns? Explain your answer.arrow_forward
- GM cuts jobs at its Australian manufacturing unit GM will cut 500 jobs, or about 12% of its workforce, at its Australian plant because of a sharp fall in demand for its locally-made "Cruze" small car. Source: The Wall Street Journal, April 8, 2013 As GM cuts its workforce, how will the marginal product and average product of a worker change in the short run? Suppose that before the cuts the marginal product of GM workers is below their average product. As the number of workers decreases, the marginal product of a GM worker and the average product of a GM worker in the short run. increases; decreases does not change; does not change decreases; decreases increases; increases decreases; increasesarrow_forwardConsider this production function. Study hours 2. 4 10 11 12 14 15 or more 13 Grade 20 33 42 50 57 63 69 73 78 81 84 86 88 89 90 1007 90 - 80 70 60 S0 40 30 20 10 Hours of study per day Select one or more: a. The average product of labour is falling as hours of study increase. O b. The marginal product of labour is constant as hours of study increase. O c. The marginal product of labour is rising as hours of study increase. U d. The marginal product of labour is zero beyond 15 hours. Final grade 9-arrow_forwardWrite out an example Cobb-Douglas production function. Derive the signsfor the relationship between labor and output and for marginal product oflabor and labor, holding other inputs fixed. Explain with economic intuition.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education


Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON

Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON

Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning

Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education