Carolyn owns a soda factory and hires workers in a competitive labor market to bottle the soda. Her company's weekly output of bottled soda varies with the number of workers hired, as shown in the following table:
Number of workers Cases/week
0…………………………0
1…………………………200
2…………………………360
3…………………………480
4…………………………560
5…………………………600
a. If each case sells for $10 more than the cost of the materials used in pro¬ducing it and the competitive market wage is $1,000 per week, how many workers should Carolyn hire? How many cases will be produced per week?
b. Suppose the Soda Bottlers Union now sets a weekly minimum acceptable wage of $1,500 per week. All the workers Carolyn hires belong to the union. How does the minimum wage affect Carolyn's decision about how many workers to hire?
c. If the wage is again $1,000 per week but the price of soda rises to $15 per case, how many workers will Carolyn now hire?