Wal-Mart is laying-off cashiers, and increasingly adopting the policy where customers must use self-checkout or pay fee. Jason Clarke is the manager of a Wal-Mart superstore at 13490 Beach Blvd, Jacksonville, FL 32224. There are 20 cashiers and 8 self-checkout stations in this store that serve 1000 customers every hour. If the MRTS at this point is 0.2 (capital is on the vertical axis of the isoquant map), then Jason would be willing to lay-off ________ cashiers for one more self checkout station in order to maintain current service.
a. suppose that the upper management ask Jason for suggestion whether to install more self-checkout station or hire more cashiers. Jason notices that the average wage of cashiers is $15/hour and the opportunity cost of a self-checkout station is $5/hour. What do you advise Jason to suggest and why?