Suppose that labor is Becky's only variable cost and that she has a fixed cost of $30 per day and pays each of her workers $30 per day. Use the orange points (square symbol) to plot Becky's total cost curve on the following graph using the quantities from the preceding table. 200 180 Total Cost 160 140 120 (Dollars)

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Chapter1: Making Economics Decisions
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Suppose that labor is Becky's only variable cost and that she has a fixed cost of $30 per day and pays each of her workers $30 per day.
Use the orange points (square symbol) to plot Becky's total cost curve on the following graph using the quantities from the preceding table.
200
180
Total Cost
160
140
120
100
80
60
40
20
40
60
80
100
120
140
160
180
200
QUANTITY OF OUTPUT (Pizzas)
True or False: The shape of the production function reflects the law of diminishing marginal returns.
True
False
TOTAL COST (Dollars)
20
Transcribed Image Text:Suppose that labor is Becky's only variable cost and that she has a fixed cost of $30 per day and pays each of her workers $30 per day. Use the orange points (square symbol) to plot Becky's total cost curve on the following graph using the quantities from the preceding table. 200 180 Total Cost 160 140 120 100 80 60 40 20 40 60 80 100 120 140 160 180 200 QUANTITY OF OUTPUT (Pizzas) True or False: The shape of the production function reflects the law of diminishing marginal returns. True False TOTAL COST (Dollars) 20
2. Inputs and outputs
Becky's Performance Pizza is a small restaurant in Detroit that sells gluten-free pizzas. Becky's very tiny kitchen has barely enough room for the four
ovens in which her workers bake the pizzas. Becky signed a lease obligating her to pay the rent for the four ovens for the next year. Because of this,
and because Becky's kitchen cannot fit more than four ovens, Becky cannot change the number of ovens she uses in her production of pizzas in the
short run.
However, Becky's decision regarding how many workers to use can vary from week to week because her workers tend to be students. Each Monday,
Becky lets them know how many workers she needs for each day of the week. In the short run, these workers are variable
inputs, and the ovens
are
fixed
inputs.
Becky'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
50
2
90
3
120
4
140
150
Transcribed Image Text:2. Inputs and outputs Becky's Performance Pizza is a small restaurant in Detroit that sells gluten-free pizzas. Becky's very tiny kitchen has barely enough room for the four ovens in which her workers bake the pizzas. Becky signed a lease obligating her to pay the rent for the four ovens for the next year. Because of this, and because Becky's kitchen cannot fit more than four ovens, Becky cannot change the number of ovens she uses in her production of pizzas in the short run. However, Becky's decision regarding how many workers to use can vary from week to week because her workers tend to be students. Each Monday, Becky lets them know how many workers she needs for each day of the week. In the short run, these workers are variable inputs, and the ovens are fixed inputs. Becky'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 50 2 90 3 120 4 140 150
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