Suppose you obtain a summer job working at a restaurant. You spend each ten-hour day and pots
Question:
Suppose you obtain a summer job working at a restaurant. You spend each ten-hour day and pots scrubbed on the horizontal axis. Suppose that you can peel 60 onions per hour, and scrub 20 pots per hour.
a) Find your PPC for a ten-hour day. Put onions peeled on the vertical axis and pots scrubbed on the horizontal axis.
b) On your graph, show i) an inefficient point, ii) an efficient point, and iii) an unattainable point.
c) What is the opportunity cost of scrubbing one pot?
d) Suppose that you spend the day peeling 300 onion and scrubbing 100 pots. How would you characterize that allocation?
e) Suppose that your boss buys an electric onion peeler that allows you to peel 90 onions per hour. How does your PPC change? Show on your graph from a). What is the new opportunity cost of scrubbing one pot?
Managerial Economics
ISBN: 978-0133020267
7th edition
Authors: Paul Keat, Philip K Young, Steve Erfle