Acopy company wants to expand production. it currently has 20 workers who share eight copiers. two months ago, the firm added two copiers, and output increased by 200,000 pages per day. one month ago, the firm added five workers, and productivity also increased by 100,000 pages per day. a copier costs about three times as much as a worker.

Number of copier added = 2

Increase in production from 2 Copier = 100,000 pages per day

Marginal product per copier per day = 100,000 / 2 = 50,000 pages per day

Increase in number of workers = 5

Increase in production from 5 workers = 100,000 pages per day

Marginal product of 1 worker = 20,000 pages per day

Cost of Copier = 3×Cost of Worker

Let Cost of worker be $1.

Cost of Copier = $3

Marginal Product per unit of Copier = 50,000 per $3 spent on Copier

= 16,667 pages per day per $1 spent

Marginal Product per unit of Worker = 20,000 pages per day per $1 spent

So, the firm should hire more workers than copiers as per $1 spent on workers is giving the firm more pages per day.

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