EatHub is a food delivery service that hires drivers (labor) and rents delivery vehicles (physical capital) to manage its operations. The current wage rate for drivers is $8 per hour, while the rental rate for vehicles is $10 per hour. Each driver can complete 50 deliveries per hour (marginal product of labor), and each vehicle enables 60 delivers per hour (marginal product of capital). Which of the following statements is the correct advice one would offer to EatHub about its current combination of labor and capital? EatHub should employ more drivers and increase the number of delivery trucks rented. EatHub should layoff some drivers (decrease the number workers employed) and increase the number of delivery trucks rented. EatHub should layoff some drivers (decrease the number workers employed) and decrease the number of delivery trucks rented. EatHub should not change its current combination of drivers employed and delivery trucks rented. EatHub should employ more drivers and decrease the number of delivery trucks rented.
EatHub is a food delivery service that hires drivers (labor) and rents delivery vehicles (physical capital) to manage its operations. The current wage rate for drivers is $8 per hour, while the rental rate for vehicles is $10 per hour. Each driver can complete 50 deliveries per hour (marginal product of labor), and each vehicle enables 60 delivers per hour (marginal product of capital). Which of the following statements is the correct advice one would offer to EatHub about its current combination of labor and capital? EatHub should employ more drivers and increase the number of delivery trucks rented. EatHub should layoff some drivers (decrease the number workers employed) and increase the number of delivery trucks rented. EatHub should layoff some drivers (decrease the number workers employed) and decrease the number of delivery trucks rented. EatHub should not change its current combination of drivers employed and delivery trucks rented. EatHub should employ more drivers and decrease the number of delivery trucks rented.
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter7: Production And Cost In The Firm
Section: Chapter Questions
Problem 19PAE
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Transcribed Image Text:EatHub is a food delivery service that hires drivers (labor) and rents delivery vehicles (physical capital) to manage
its operations. The current wage rate for drivers is $8 per hour, while the rental rate for vehicles is $10 per hour.
Each driver can complete 50 deliveries per hour (marginal product of labor), and each vehicle enables 60 delivers
per hour (marginal product of capital).
Which of the following statements is the correct advice one would offer to EatHub about its current combination
of labor and capital?
EatHub should employ more drivers and increase the number of delivery trucks rented.
EatHub should layoff some drivers (decrease the number workers employed) and increase the number of
delivery trucks rented.
EatHub should layoff some drivers (decrease the number workers employed) and decrease the number of
delivery trucks rented.
EatHub should not change its current combination of drivers employed and delivery trucks rented.
EatHub should employ more drivers and decrease the number of delivery trucks rented.
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