A sofa manufacturer currently is using 50 workers and 30 machines to produce 5,000 sofas a day. The wage rate is $200 and the rental rate for a machine is $1,000. At these input levels, another worker adds 200 sofas, while another machine adds 500 sofas. If the firm uses 45 workers and 31 machines instead, then its

Question

Answer

cost will be unchanged, and its output will increase by 500 units.

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output will be unchanged, and its cost will decrease by $800.

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cost will be unchanged, and its output will decrease by 500 units.

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none of the above

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cost will be unchanged, and its output will increase by 300 units.

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A sofa manufacturer currently is using 50 workers and 30 machines to produce 5,0...

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