CASE STUDIES AND BOX 6.2 DIMINISHING RETURNS IN THE BREAD SHOP Is the baker using his loaf? Just up the road from where John lives is a bread shop. Like I There is only one cash till. Assistants frequently had to many others, he buys his bread there on a Saturday morning. wait while other assistants used it. Not surprisingly, Saturday morning is the busiest time ofthe I There is only one pile oftissue paper for wrapping the week for the shop and as a result it takes on extra assistants. bread. Again the assistants often had to wait. During the week only one assistant serves the customers, The fth and maybe even the fourth assistant ended up but on a Saturday morning there used to be ve serving. But serving very few extra customers. could they serve ve times as many customers? No, they could John is Su going to the same bread shop and they still "0t. There were diminishing returns to labour. have only one till and one pile oftissue paper. But now only The trouble is that certain factors of production in the three assistants are employed on a Saturday! The shop, shop are xed: however, is just as busy. I The shop is a fixed size. It gets very crowded on Saturday morning. Assistants sometimes had to wait while customers squeezed past each other to get to the counter, should (a) employ four assistants on a Saturday; . . _ (b) extend his shop, thereby allowing more customers get in each other's way. opening hours on a Saturday? How would you advise the baker as to whether he 0