Suppose in a pizza restaurant, its total output (number of pizzas made per hour) can be...
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Suppose in a pizza restaurant, its total output (number of pizzas made per hour) can be presented as the table below. It shows you the number of pizzas made with respect to various number of labors input per hour. Number of Labor 1 2 3 Total output/ hour 10 pizzas 18 pizzas 25 pizzas Number of Labor 4 5 6 Total output/ hour 31 pizzas 36 pizzas 40 pizzas (1) If the net price (excluding material costs) of a pizza is $4.00. And the nominal wage of a worker is $20.00 per hour. How much is the real wage in this case? And how many workers should be employed (per hour) to maximize its profit. Note: for full credit, you need to show step by step answers. (2) Now suppose the price of pizza goes up to $5.00 per unit, ceteris paribus, how many labor(s) should be hired to maximize the profit? Suppose in a pizza restaurant, its total output (number of pizzas made per hour) can be presented as the table below. It shows you the number of pizzas made with respect to various number of labors input per hour. Number of Labor 1 2 3 Total output/ hour 10 pizzas 18 pizzas 25 pizzas Number of Labor 4 5 6 Total output/ hour 31 pizzas 36 pizzas 40 pizzas (1) If the net price (excluding material costs) of a pizza is $4.00. And the nominal wage of a worker is $20.00 per hour. How much is the real wage in this case? And how many workers should be employed (per hour) to maximize its profit. Note: for full credit, you need to show step by step answers. (2) Now suppose the price of pizza goes up to $5.00 per unit, ceteris paribus, how many labor(s) should be hired to maximize the profit?
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Related Book For
Economics Principles and Policy
ISBN: 978-0538453653
12th edition
Authors: William J. Baumol, Alan S. Blinder
Posted Date:
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