Starbucks makes espresso drinks using an espresso maker and…
Starbucks makes espresso drinks using an espresso maker and employees. a. Starbucks uses two machines and two workers to produces 20 drinks/shift (point A). The use of these inputs implies a total cost of $50. If the rental cost of the machines is $15/shift, use your knowledge of isocost curves to find wage. (6 points) b. When the rental rate of espresso machines falls to $10/unit, the firm now uses 3 machines and 1 worker (Point B). Draw the new isocost curve and find associated total cost. (8 points)