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Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Hint: Be sure to plot the first point at (0, 0). 300 270 Production Function 240 210 180 150 120 90 60 30 1 2 3 4 LABOR (Number of workers) Suppose that labor is Teresa's only variable cost and that she has a fixed cost of $50 per day and pays each of her workers $40 per day QUANTITY OF OUTPUT (Pizzas)

Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Hint: Be sure to plot the first point at (0, 0). 300 270 Production Function 240 210 180 150 120 90 60 30 1 2 3 4 LABOR (Number of workers) Suppose that labor is Teresa's only variable cost and that she has a fixed cost of $50 per day and pays each of her workers $40 per day QUANTITY OF OUTPUT (Pizzas)

Microeconomics: Private and Public Choice (MindTap Course List)
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter7: Consumer Choice And Elasticity
Section: Chapter Questions
Problem 2CQ
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Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Hint: Be sure to plot the first point at (0, 0). 300 270 Production Function 240 210 180 150 120 90 60 30 1 2 3 4 5 LABOR (Number of workers) Suppose that labor is Teresa's only variable cost and that she has a fixed cost of $50 per day and pays each of her workers $40 per day. QUANTITY OF OUTPUT (Pizzas)
Transcribed Image Text:Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Hint: Be sure to plot the first point at (0, 0). 300 270 Production Function 240 210 180 150 120 90 60 30 1 2 3 4 5 LABOR (Number of workers) Suppose that labor is Teresa's only variable cost and that she has a fixed cost of $50 per day and pays each of her workers $40 per day. QUANTITY OF OUTPUT (Pizzas)
2. Inputs and outputs Teresa's Performance Pizza is a small restaurant in Dallas that sells gluten-free pizzas. Teresa's very tiny kitchen has barely enough room for the four ovens in which her workers bake the pizzas. Teresa signed a lease obligating her to pay the rent for the four ovens for the next year. Because of this, and because Teresa's kitchen cannot fit more than four ovens, Teresa cannot change the number of ovens she uses in her production of pizzas in the short run. However, Teresa's decision regarding how many workers to use can vary from week to week because her workers tend to be students. Each Monday, Teresa lets them know how many workers she needs for each day of the week. In the short run, these workers are inputs, and the ovens are inputs. Teresa's daily production schedule is presented in the following table. 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) 1 100 2 180 3 240 4 280 300
Transcribed Image Text:2. Inputs and outputs Teresa's Performance Pizza is a small restaurant in Dallas that sells gluten-free pizzas. Teresa's very tiny kitchen has barely enough room for the four ovens in which her workers bake the pizzas. Teresa signed a lease obligating her to pay the rent for the four ovens for the next year. Because of this, and because Teresa's kitchen cannot fit more than four ovens, Teresa cannot change the number of ovens she uses in her production of pizzas in the short run. However, Teresa's decision regarding how many workers to use can vary from week to week because her workers tend to be students. Each Monday, Teresa lets them know how many workers she needs for each day of the week. In the short run, these workers are inputs, and the ovens are inputs. Teresa's daily production schedule is presented in the following table. 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) 1 100 2 180 3 240 4 280 300
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