Question

In: Economics

1a)A copy company wants to expand production. It currently has 20 workers who share eight copiers....

1a)A copy company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers and output increased by 120,000 pages per day. One month ago, they added 5 workers and productivity also increased by 110,000 pages per day. Copiers cost about three times as much as workers. What is the output of pages per worker?

a. 24,000 pages

b. 5,500 pages

c. 22,000 pages

d. 6,000 pages

e. 10,000 pages

f. 12,000 pages

1B)

A copy company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers and output increased by 120,000 pages per day. One month ago, they added 5 workers and productivity also increased by 110,000 pages per day. Copiers cost about three times as much as workers.  What is the output of pages per copier machine?

a.

55,000 pages

b.

110,00 pages

c.

120,000 pages

d.

60,000 pages

e.

13,750 pages

f.

15,000 pages

1C)

A copy company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers and output increased by 120,000 pages per day. One month ago, they added 5 workers and productivity also increased by 110,000 pages per day. Copiers cost about three times as much as workers.  Would you recommend they hire another employee or buy another copier?

a.

One more employee.

b.

One more copier.

c.

Either a copier or an employee.

d.

One copier and one employee.

1D)

A copy company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers and output increased by 120,000 pages per day. One month ago, they added 5 workers and productivity also increased by 110,000 pages per day. Copiers cost about three times as much as workers.  Provide a justification for your answer in for the previous question (Q30).

a.

A copier costs only three times as much but provides 5 times the output of an employee.

b.

A copier costs only three times as much but provides 4 times the output of an employee.

c.

A copier costs three times as much and also provides 3 times the output as an employee.

d.

A copier costs three times as much but provides less than 3 times the output of an employee.

Solutions

Expert Solution

1a) Option c. 22,000 pages

One month ago when the copy company added 5 workers, productivity increased by 110,000 pages per day.

So, the output of pages per worker = 110,000 / 5 = 22,000 pages per worker

1b) Option d. 60,000 pages

Two months ago when the firm added two copiers and output increased by 120,000 pages per day.

The output of pages per copier machine = 120000 / 2 = 60,000

1c) Option a. One more employee.

Copiers cost about three times as much as workers.  

So,I would recommend they hire another employee because another employee can produce 22,000 pages per worker and another copier can produce 60.000 pages per copier machine which is less than 3 times of what another employee can produce. If we see, 3 times of another employee = 22,000 * 3 = 66,000. For a copier machine to be worthy of the workers they should produce more than 66,000 pages which they do not, so the company should hire another employee.

1d) Option d. A copier costs three times as much but provides less than 3 times the output of an employee.

As I explained previously, the output of an employee = 22,000 per worker and the output of a copier = 60,000 per copier. Three times the output of an employee = 22,000 * 3 = 66,000 which a copier doesn't provide but still costs three times as much as an employee.


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