Ratio of marginal product

Reference no: EM1368179

You were recently hired to replace the manager of the Roller Division at a major conveyor manufacturing firm, despite the manager's strong external sales record. Roller manufacturing is relatively simple, requiring only labor and a machine that cuts and crimps rollers. As you begin reviewing the company's production information, you learn that labor is paid $12 per hour and the last worker hired produced 150 rollers per hour. The company rents roller cutters and crimping machines for $24 per hour; and the marginal product of capital is 150 rollers per hour. What do you think the previous manager could have done to keep his job?

Reference no: EM1368179

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