Assume that the sale price of chairs is always sufficiently high that it is profitable to fulfill this 80-chair order. The firm needs to make 80 chairs to fulfill its order. Assume also that the firm is profit maximizing (& therefore cost minimizing). What combinations of robot and worker hours must they use to minimize costs? Show your work. Use the equation that must be true for cost minimization Suppose that there is a firm that produces chairs and the firm receives an order for 80 chairs. Thefirm has two resources available to it. The first is a (human) worker, who must be paid $18 foreach hour they spend producing chairs. The second is a robot, that costs $15 of inputs (includingelectricity and maintenance) for each hour it works. Chairs produced by either method areidentical and of equivalent quality.Assume that the use of these two inputs is completely independent. This means that the numberof hours of robot-work does not affect the productivity of the worker, and vice versa.The production of chairs based upon the numbers of hours of each of the inputs used is givenbelow. For example, 2 hours of robot time will produce 10 chairs. 7 hours of worker time willproduce 54 chairs.RobotHours01234567891011121314RobotProduction0510152025303540455055606570RobotHours01234567891011121314WorkerProduction0152533404550545758596061।6263

The cost of producing an additional unit of goods is called Marginal cost. (MC). The marginal…

Answered: Assume that the sale price of chairs is…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume that the sale price of chairs is always sufficiently high that it is profitable to fulfill this
80-chair order. The firm needs to make 80 chairs to fulfill its order. Assume also that the firm is
profit maximizing (& therefore cost minimizing).

What combinations of robot and worker hours must they use to minimize costs? Show
your work. Use the equation that must be true for cost minimization

Suppose that there is a firm that produces chairs and the firm receives an order for 80 chairs. The
firm has two resources available to it. The first is a (human) worker, who must be paid $18 for
each hour they spend producing chairs. The second is a robot, that costs $15 of inputs (including
electricity and maintenance) for each hour it works. Chairs produced by either method are
identical and of equivalent quality.
Assume that the use of these two inputs is completely independent. This means that the number
of hours of robot-work does not affect the productivity of the worker, and vice versa.
The production of chairs based upon the numbers of hours of each of the inputs used is given
below. For example, 2 hours of robot time will produce 10 chairs. 7 hours of worker time will
produce 54 chairs.
Robot
Hours
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Robot
Production
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
Robot
Hours
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Worker
Production
0
15
25
33
40
45
50
54
57
58
59
60
61
।
62
63

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