Question

 2. Inputs and outputs

 Antonio's Performance Pizza is a small restaurant in San Diego that sells gluten-free pizzas. Antonio's very tiny kitchen has barely enough room for the three ovens in which his workers bake the pizzas. Antonio signed a lease obligating him to pay the rent for the three ovens for the next year. Because of this, and because Antonio's kitchen cannot fit more than three ovens, Antonio cannot change the number of ovens he uses in his production of pizzas in the short run.

 However, Antonio's decision regarding how many workers to use can vary from week to week because his workers tend to be students. Each Monday,

 Antonio lets them know how many workers he needs for each day of the week. In the short run, these workers are _______ inputs, and the ovens are _______ inputs.

 Antonio's daily production schedule is presented in the following table.

 Fill in the blanks to complete the Marginal Product of Labor column for each worker.

 On the following graph, plot Antonio's production function using the green points (triangle symbol).

 Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. 

Hint: Be sure to plot the first point at (0, 0).

 Suppose that labor is Antonio's only variable cost and that he has a fixed cost of $10 per day and pays each of his workers $50 per day.

 Use the orange points (square symbol) to plot Antonio's total cost curve on the following graph using the quantities from the preceding table.

 True or False: The shape of the production function reflects the law of diminishing marginal returns. 

•  True

•  False

Answer 1

In the short runs,workers are variable inputs and the ovens are fixed inputs

Workers	Output	MPL
0	0
1	70	70
2	120	50
3	160	40
4	190	30
5	200	10

FC=10 and each labor cost = 50

Workers	Output	FC	VC	TC
0	0	10	0	10
1	70	10	50	60
2	120	10	100	110
3	160	10	150	160
4	190	10	200	210
5	200	10	250	260

The last statement is True