Question
Continuing the prior question, suppose that Universal Gizmo devises a new plant design that uses 15 gizmo presses and 5 workers also to produce 100
Continuing the prior question, suppose that Universal
Gizmo devises a new plant design that uses
15 gizmo presses and 5 workers also to produce
100 gizmos per day. How would you construct an
isoquant for the firm for 100,000 gizmos per day
based on the following assumptions:
a. The firm uses plants only of the type specified
in question 7.
b. The firm uses plants only of its new type.
c. The firm uses 500 plants of the type in question
7 and 500 plants of the new type.
What do you conclude about the ability of UG
to substitute workers for gizmo presses in its
production?
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