1.Your company utilizes both employees (L) and specialized robots (R) in its production process. The hourly wage of employees is $20, and the hourly cost of operating a robot is $250. The table below describes how the number of each type of input affects output or product (in a marginal way).

Number of employees (L) Marginal product of labor (MP_L). Number of robots (R). Marginal product of robots (MP_R)

1 36 1 525

2 32 2 500

3 28 3 475

4 24 4 450

5 20 5 425

6 16 6 400

7 12 7 375

a.Given the much lower productivity of employees, why would the company ever consider using employees at all in its production?

b.Given its budget, the company is currently using five employees and four robots; is this an ideal combination of inputs? Why or why not?

c.During its slow season, the company reduces its employees to two; what would be the optimal number of robots to use in this situation?

d.During the normal season when the company uses four robots, what would be the optimal number of employees to use?