Restaurant chain Garlic Patch is employing both tabletop tablets and waiters. At its typical location, and given current numbers of workers and tablets, consultants estimate that twenty tabletop tablets can substitute for one waiter. The restaurant pays its typical waiter $5 an hour.

1) For the restaurant chain to be using the optimal mix of tabletop tablets and waiters, what must be the per-hour cost of use of a tabletop tablet?

2) If the cost of a tabletop tablet has been estimated at $0.25 an hour, is Garlic Patch currently maximizing profit? If yes, why? If not, will the company increase its profit by increasing or reducing its number of waiters relative to tablets? Explain.

3) Suppose the federal subminimum wage of $2.13 per hour (which applies to employees receiving tips, such as waiters) is eliminated, and the minimum wage is raised to $15 per hour. How will this affect the chain's optimal employment of waiters and tablets