You own a pizza shop called "Pizzas'R' Us".Currently you are paying your cooks an hourly wage of $20.You sell a medium pizza for $10.By hiring more cooks,you can increase your pizza production as shown in the following table. $\begin{array} { | l | l | } \hline \begin{array} { l } \text { Number of } \\\text { cooks }\end{array} & \begin{array} { l } \text { Total production of } \\\text { pizzas each hour }\end{array} \\\hline 0 & 0 \\\hline 1 & 4 \\\hline 2 & 7 \\\hline 3 & 9 \\\hline 4 & 10 \\\hline 5 & 10 \\\hline\end{array}$
If you operate one hour every day,what is the marginal cost of hiring the 4^th cook?

Question

You own a pizza shop called "Pizzas'R' Us".Currently you are paying your cooks an hourly wage of $20.You sell a medium pizza for $10.By hiring more cooks,you can increase your pizza production as shown in the following table.

\begin{array} { | l | l | } \hline \begin{array} { l } \text { Number of } \\\text { cooks }\end{array} & \begin{array} { l } \text { Total production of } \\\text { pizzas each hour }\end{array} \\\hline 0 & 0 \\\hline 1 & 4 \\\hline 2 & 7 \\\hline 3 & 9 \\\hline 4 & 10 \\\hline 5 & 10 \\\hline\end{array}

If you operate one hour every day,what is the marginal cost of hiring the 4^th cook?

Quizplus · Accepted Answer

The marginal cost of hiring the 4th cook is the additional cost incurred to produce one more pizza. Hiring the 4th cook increases production from 9 to 10 pizzas, so the marginal cost is the cook's wage ($20) divided by the additional pizza produced (1), which equals $20.

You Own a Pizza Shop Called "Pizzas'R' Us If You Operate One Hour Every Day,what Is the Marginal