Jan is excited because her carwash has beem making lots of money this year. She

Question

Jan is excited because her carwash has beem making lots of money this year. She comes out of her office and tells you that she plans on permanently tripiling the amount of employees at her carwash tomorrow to 30 instead of 10. Concered, you ask Jan if:

a.) She has considered the MPP per worker and if she plans on changing her fixed inputs, such as the number of parking spots in her carwash.

b.) She has considered the ATC per worker and if she plans on changing her fixed inputs, such as the number of parking spots in her carwash.

c.) She has considered minimizing AVC, so that she will be able to generate as much revenue as possible.

d.) She has considered diseconomies of scale and should be decreasing the price of getting your car washed instead of hiring more workers.

Explanation / Answer

In this Case B is correct

SHe will reconsider the ATC./ worker and she will definately planson changing fxed inputs.

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