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2. Inputs and outputs Kaliah's Pizzas is a takeout-only pizza parlor servicing the college campus of Santa Barbara that specializes in vegan pizzas. Kaliah's small
2. Inputs and outputs Kaliah's Pizzas is a takeout-only pizza parlor servicing the college campus of Santa Barbara that specializes in vegan pizzas. Kaliah's small shop has barely enough room for customers to stand and wait, let alone the five pizza ovens necessary to keep up with the hungry student customers. Kaliah signed a lease renting both the five ovens and the storefront for the next year. Due to the terms of the lease and the building's size constraint, Kaliah is unable to change the store's number of pizza ovens in the short run. However, Kaliah does face a decision regarding the number of employees to schedule on a weekly basis. Every Sunday, Kaliah 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 variable Y inputs, and pizza ovens are fixed V inputs. xed The following ta 5 Kaliah'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 7o 1 70 50 2 120 40 3 160 30 4 190 10 5 200 Suppose that Kaliah's only variable cost is labor. Assume that Kaliah faces daily fixed costs of $10 and pays all workers the same daily wage of $50. Use the orange points (square symbol) to plot Kaliah's total cost curve on the folio wing graph using the quantities from the preceding table. 6N \\J/ 280 250 El 240 Total Cost 220 200 180 160 140 120 100 TOTAL COST (Dollars) 80 60 40 20 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 increasing marginal returns. True False On the following graph, plot Kaliah '5 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). /'\\ k?) 200 A A A 130 160 A Production Function .5 J; O 120 A 100 QUANTITY OF OUTPUT (Pizzas) 8 8 4:. o M D LABOR (Number of workers)
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