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2. Inputs and outputs Aliyah's Pizzas is a takeout-only pizza parlor servicing the college campus of Morgantown that specializes in vegan pizzas. Aliyah's small shop
2. Inputs and outputs Aliyah's Pizzas is a takeout-only pizza parlor servicing the college campus of Morgantown that specializes in vegan pizzas. Aliyah's small shop has barely enough room for customers to stand and wait, let alone the three pizza ovens necessary to keep up with the hungry student customers. Aliyah signed a lease renting both the three ovens and the storefront for the next year. Due to the terms of the lease and the building's size constraint, Aliyah is unable to change the store's number of pizza ovens in the short run. However, Aliyah does face a decision regarding the number of employees to schedule on a weekly basis. Every Sunday, Aliyah contacts the staff to communicate the amount of workers needed on each day of the upcoming week. In the short run, the store employees are W inputs, and pizza ovens are W inputs. The following table presents Aliyah's daily production schedule. Fill in the blanks to complete the Marginal Product of Labor column for each worker. Labor Output Marginal Product of Labor (Number of workers) (Pizzas) (Pizzas) 0 0 3 200 On the following graph, plot Aliyah's production function using the green points (triangle symbol). Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Hint: Be sure to plot the first point at (0, 0). (?) 200 A Production Function QUANTITY OF OUTPUT (Pizzas) 0 8 8 8 8 8 5 5 8 8 o + LABOR (Number of workers) Suppose that Aliyah's only variable cost is labor. Assume that Aliyah faces daily fixed costs of $10 and pays all workers the same daily wage of $50. Use the orange points (square symbol) to plot Aliyah's total cost curve on the following graph using the quantities from the preceding table. (?) Total Cost TOTAL COST (Dollars) 0 20 40 60 80 100 120 140 160 180 200 QUANTITY OF OUTPUT (Pizzas) True or False: The shape of the production function reflects the law of diminishing marginal returns. O True O False
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