If wages in restaurant is $9.00 per hour and price of a Hamburger is $4.00 and production function for the workers is:
Q = 5L - 0.25L2
1. Determine how many workers should Your Restaurant employ during lunch hour to maximize profits?
2. Calculate the maximum profit at Your Restaurant. (Note-consider that profit involves Total Revenue and Total Costs)
3. Calculate the profit created if You hire an additional 0.5 worker. Explain why it is or is not profit maximizing to hire an additional 0.5 worker.
4. Assume instead that you want to keep the lines as short as possible by maximizing production. Determine how many workers should you employ during the lunch hour?