Your firm produces clay pots entirely by hand even though a pottery machine exis

Question

Your firm produces clay pots entirely by hand even though a pottery machine
exists that can make clay pots faster than a human. Workers cost $80 per day and
each additional worker can produce 20 more pots per day (i.e., marginal product
is constant and equal to 20). Installation of the first pottery machine would
increase output by 300 pots per day. Currently your firm produces 1,800 pots per
day.

b. If a labor union negotiates higher wages so that labor costs rise to $160 per
day, does this change your answer to part a? Explain.

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