# Problem 1: William is the owner of a small pizza..Problem 2: The Paradise Shoes Company has est...

Aug 3rd, 2016
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Problem 1: William is the owner of a small pizza shop and is thinking of increasing products and lowering costs. William’s pizza shop owns four ovens and the cost of the four ovens is \$1,000. Each worker is paid \$500 per week. Workers employed Qty of pizzas produced per week 0 1 2 3 4 5 6 7 8 0 75 180 360 600 900 1140 1260 1360 Show all of your calculations and processes. Describe your answer for each question in complete sentences, whenever it is necessary........... Problem 2: The Paradise Shoes Company has estimated its weekly TVC function from data collected over the past several months, as TVC = 3450 + 20Q + 0.008Q2 where TVC represents the total variable cost and Q represents pairs of shoes produced per week. And its demand equation is Q = 4100 – 25P. The company is currently producing 1,000 pairs of shoes weekly and is considering expanding its output to 1,200 pairs of shoes weekly. To do this, it will have to lease another shoe-making machine (\$2,000 per week fixed payment....

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15Please complete the following two applied problems:Problem 1:William is the owner of a small pizza shop and is thinking of increasing products and loweringcosts. Williams pizza shop owns four ovens and the cost of the four ovens is \$1,000. Eachworker is paid \$500 per week.Workers employed Qty of pizzas produced per week001752180336046005900611407126081360Show all of your calculations and processes. Describe your answer for each question in completesentences, whenever it is necessary.1. Which inputs are fixed and which are variable in the production function of Williamspizza shop? Over what ranges do there appear to be increasing, constant, and/ordiminishing returns to the number of workers employed?2. What number of workers appears to be most efficient in terms of pizza product perworker?3. What number of workers appears to minimize the marginal cost of pizza productionassuming that each pizza worker is paid \$500 per week?4. Why would marginal productivity decline when you hire more workers in the short runafter a certain level?5. How would expanding the business affect the economies of scale? When would you haveconstant returns to scale or diseconomies of scale? Describe your answer.Problem 2:The Paradise Shoes Company has estimated its weekly TVC function from data collected overthe past several months, as TVC = 3450 + 20Q + 0.008Q2 where TVC represents the totalvariable cost and Q represents pairs of shoes produced per wee

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