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).300270Production Function24021018015012090603012345LABOR (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 outputsTeresa'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 fourovens 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 theshort 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 areinputs, and theovens areinputs.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.LaborOutputMarginal Product of Labor(Number of workers)(Pizzas)(Pizzas)1100218032404280300

Labor Output Marginal product of labour Fixed cost Variable cost Total cost 0 0 0 50 40…

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)

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 42P: A small company that shovels sidewalks and driveways has 100 homes signed up for its services this...

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If two painters can paint 200 square feet of wall in an hour, and three painters can paint 275 square feet, what is the marginal product of the third painter?
A small company that shovels sidewalks and driveways has 100 homes signed up for its services this winter. It can use various combinations of capital and labor: intensive labor with hand shovels, less labor with snow blowers, and still less labor with a pickup truck that has a snowplow on front. To summarize, the method Choices are: Method 1: 50 units of labor, 10 units of capital Method 2: 20 units of labor, 40 units of capital Method 3: 10 units of labor, 70 units of capital If hiring labor for the winter costs $100/unit and a unit of capital costs 400, what is the best production method? What method should the company use if the cost of labor rises to $20/unit?
Do you think that the taxicab industry in large cities would be subject to significant economies of scale? Why or why not?
2. Inputs and outputs Edison's Performance Pizza is a small restaurant in Philadelphia that sells gluten-free pizzas. Edison's very tiny kitchen has barely enough room for the three ovens in which his workers bake the pizzas. Edison signed a lease obligating him to pay the rent for the three ovens for the next year. Because of this, and because Edison's kitchen cannot fit more than three ovens, Edison cannot change the number of ovens he uses in his production of pizzas in the short run. However, Edison's decision regarding how many workers to use can vary from week to week because his workers tend to be students. Each Monday, Edison lets them know how many workers he needs for each day of the week. In the short run, these workers are inputs, and the ovens are inputs. Edison'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…
2. Inputs and outputs Dmitri's Performance Pizza is a small restaurant in Philadelphia that sells gluten-free pizzas. Dmitri's very tiny kitchen has barely enough room for the four ovens in which his workers bake the pizzas. Dmitri signed a lease obligating him to pay the rent for the four ovens for the next year. Because of this, and because Dmitri's kitchen cannot fit more than four ovens, Dmitri cannot change the number of ovens he uses in his production of pizzas in the short run.
Monique has a flock of six chickens in her backyard that she initially bought for $6 each. Theflock currently lays 20 eggs per week, which Monique and her family consume at home, andher current cost of feed is $2 per week. Monique has a job that pays $8/hour with flexiblehours, but she is thinking of selling her chickens’ eggs to earn extra income. To start sellingeggs, she would need to increase production to 30 eggs per week. She can do this by increasingthe chickens’ feed to $3 per week and taking an hour off work each week to devote to chickenrearing. If the market price of her farm-fresh eggs is $1 per egg, what would be Monique’sweekly economic profits from selling her chickens’ eggs? (Select one from below) (a) −$9: This is her revenue minus her accounting cost.(b) −$1: This is her revenue minus her production cost.(c) $0: Eggs are a constant-cost market so producers must earn 0 profits.(d) $1: This is her revenue minus her economic cost.(e) $7: This is her revenue minus her…
Suppose Nicholas owns a business making Christmas tree ornaments. Currently, he makes 300 ornaments a month. At this level of production, each additional ornament takes him 30 minutes to make and costs him $5 in materials. Nicholas makes his ornaments in a small studio that he rents for $300 a month. Nicholas can easily increase or decrease the amount of time he spends making ornaments, and he can easily go to the store to buy additional materials to make the ornaments, but he has a year-long lease on his studio, so he has to pay his monthly rent no matter how many ornaments he produces each month. Nicholas values his time at $10 per hour. Other than his time, the cost of the materials and the rent on his studio, Nicholas has no additional production costs. a At Nicholas's current level of production, what is the marginal cost of making an additional ornament each month? b. At Nicholas's current level of production, what is the monthly average fixed cost of each ornament? c. Assuming…
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H6. Your mother owns and runs an arts and craft store, and the business is doing well. She would have otherwise been employed as a high school geography teacher making $80,000 a year or as an interior decorator making $68,000 a year. She owns the building in which her shop is located, which she could have rented out for $24,000 a year. Her annual revenue from the shop is $430,000 and she employs four workers, each of whom earns $30,000 a year. On average, she spends $206,000 per year traveling, purchasing, and shipping unique merchandise for resale at her store. Based on this information, do you think you should encourage her to return to teaching? Explain your advice with the help of calculations on her opportunity costs, accounting profit, and economic profit.
4) A firm faces a production function of twittle-twaps: Q(K,Lp,Ln) = 5*K(2/5)*LP(1/3)*LN(1/5) per hour, where capital (K), production labor (LP), and non-production labor (LN) are input factors used in production. The firm operates in a competitive market, where they are a price taker within the capital & labor markets and its own price (r = 40, wP = 25, wN = 50, P = 20). Answer the following.a. If capital and non-production labor are fixed at K = 32 and LN = 243, what is the general form MPLP and graph Q wrt to LP changing [you do not need to solve for LP yet].b. Is this production function decreasing, constant, or increasing returns to scale and why.c. Given the wage of production workers and the price of twittle-twaps, what is the optimal number of LP to employ to maximize profits and the quantity produced (VMPLP = wP).d. If the firm can control both K and LP, what does the Isoquant curve look like and its slope in relative terms if LN is fixed at 243 units [IQ slope =…
4) A firm faces a production function of twittle-twaps: Q(K,Lp,Ln) = 5*K(2/5)*LP(1/3)*LN(1/5) per hour, where capital (K), production labor (LP), and non-production labor (LN) are input factors used in production. The firm operates in a competitive market, where they are a price taker within the capital & labor markets and its own price (r = 40, wP = 25, wN = 50, P = 20). Answer the following.a. If capital and non-production labor are fixed at K = 32 and LN = 243, what is the general form MPLP and graph Q wrt to LP changing [you do not need to solve for LP yet].b. Is this production function decreasing, constant, or increasing returns to scale and why.c. Given the wage of production workers and the price of twittle-twaps, what is the optimal number of LP to employ to maximize profits and the quantity produced (VMPLP = wP).d. If the firm can control both K and LP, what does the Isoquant curve look like and its slope in relative terms if LN is fixed at 243 units [IQ slope =…
5. What is the marginal physical product (MPP) of a variable input, like labor?How do you derive the marginal cost (MC) curve of a firm? Explain.