A magic wand shop has one wizard worker and one magic machine producing magic wands. Denote one hour of wizard labor as

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A Magic Wand Shop Has One Wizard Worker And One Magic Machine Producing Magic Wands Denote One Hour Of Wizard Labor As 1 (133.89 KiB) Viewed 44 times

A magic wand shop has one wizard worker and one magic machine producing magic wands. Denote one hour of wizard labor as WW and one hour of machine labor as MM. One magic wand can be made by a wizard worker in 30 minutes, or it can be made by a magic machine in 10 minutes. WW and MM are perfect substitutes and are the only inputs needed to produce the wands. The goal is to produce 120 wands. The shop has to pay $20 for every hour of MM and $10 for every hour of WW. 1. For part 2 of this quiz, write down the shop's cost minimization problem, making sure to specify the correct production function. 2. To minimize operating costs, the shop should use hours of the magic machine and hours of the wizard worker. For part 2 of this quiz, explain. 3. Suppose it still costs $10 per hour to use a WW, and the shop wants to make 120 wands. The only way the shop will consider using a combination of WW and MM in the wand production is if it costs per hour to use a MM. For part 2 of this quiz, explain.