(Solved):   Nia's Pizzas is a takeout-only pizza parlor servicing the college campus of Santa ...

 

Nia's Pizzas is a takeout-only pizza parlor servicing the college campus of Santa Barbara that specializes in vegan pizzas. Nia's small shop has barely enough room for customers to stand and wait, let alone the three pizza ovens necessary to keep up with the hungry student customers. Nia signed a lease renting both the three ovens and the storefront for the next year. Due to the terms of the lease and the building's size constraint, Nia is unable to change the store's number of pizza ovens in the short run. However, Nia does face a decision regarding the number of employees to schedule on a weekly basis. Every Sunday, Nia contacts the staff to communicate the amount of workers needed on each day of the upcoming week. In the short run, the store employees are inputs, and pizza ovens are inputs. The following table presents Nia's daily production schedule. Fill in the blanks to complete the Marginal Product of Labor column for each worker. On the following graph, plot Nia'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 Nia's only variable cost is labor. Assume that Nia faces daily fixed costs of \( \$ 50 \) and pays all workers the same daily wage of \( \$ 40 \). Use the orange points (square symbol) to plot Nia's total cost curve on the following graph using the quantities from the preceding table. The law of diminishing marginal product of labor is demonstrated by which of the following? Total output increases only when you increase both labor and ovens. Total output declines as you increase the quantity of labor. Total output increases at a decreasing rate as you increase the quantity of labor.