Answer: 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.
