Fast-food restaurants like McDonalds are replacing cashiers with touch-screen ordering kiosks. Currently, the marginal product of another

Question:

Fast-food restaurants like McDonald’s are replacing cashiers with touch-screen ordering kiosks. Currently, the marginal product of another cashier is 48 customers served per hour; the marginal product of another kiosk is 32 customers served per hour. A cashier can be hired for a wage of $15; a kiosk rents for $12.

a. Is McDonald’s currently minimizing the cost of serving its customers?

b. Show how McDonald’s can improve its profits by changing its input mix.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Microeconomics

ISBN: 9781319105563

3rd Edition

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

Question Posted: