Ron's Woodworking supplies high quality wooden bowls made from exotic hardwoods from around the world for its customers. Ron has hired several employees.

1. Explain two factors that impact Ron's demand for workers in his shop.
2. Ron is considering hiring a new worker. Assuming that Ron wishes to maximize profits, how should he make the decision to hire or not hire the next worker? Explain your reasoning.
3. Ron has recently purchased a new lathe that will allow the production of several bowls from a single block of wood, greatly increasing the productivity of the workers in his shop. How will the increased productivity of Ron's workers impact the number of workers he employs? Why?