The relationship between labor usage and output at the local coffee shop is summarized in the table below.The price of a cup of espresso is $1.25 and no other inputs are required. $\begin{array}{cc}
\begin{array}{c}
\text { Labor } \
\underline {\text { Input }}
\end{array} & \begin{array}{c}
\text { Cups of } \
\underline {\text { espresso }}
\end{array} \
0 & \text { 0 } \
1 & 25 \
2 & 45 \
3 & 60 \
4 & 70 \
5 & 75
\end{array}$
The most the coffee shop would pay the third worker is _______.

Question

The relationship between labor usage and output at the local coffee shop is summarized in the table below.The price of a cup of espresso is $1.25 and no other inputs are required. $\begin{array}{cc}
\begin{array}{c}
\text { Labor } \
 \underline {\text { Input }}
\end{array} & \begin{array}{c}
\text { Cups of } \
 \underline {\text { espresso }}
\end{array} \
 0 & \text { 0 } \
1 & 25 \
2 & 45 \
3 & 60 \
4 & 70 \
5 & 75
\end{array}$
The most the coffee shop would pay the third worker is _______.

Quizplus · Accepted Answer

The marginal product of the third worker is 15 cups (60-45). At $1.25 per cup, the revenue from the third worker is 15 * $1.25 = $18.75.

The Relationship Between Labor Usage and Output at the Local