Asked by megha ramani on Jul 15, 2024
Verified
Fast Food Terminals II
Taco Casa is considering installing touch screen terminals for patrons to place their food orders.A terminal can typically accommodate the placement of 15 orders each hour while a human can process 20 orders each hour.If employee costs are $7.50/hour in wages and $4.50/hour in taxes,benefits and insurance,what is the per order opportunity cost of a touch screen?
Touch Screen
An electronic visual display that can detect the presence and location of a touch within the display area, used for interaction.
Orders
Instructions to buy or sell securities or goods, often given to a broker or company.
Wages
Wages are the monetary compensation or payment received by workers for their labor or services, typically calculated on an hourly, daily, or piecework basis.
- Determine the cost per order across various service contexts.
- Understand the concept of opportunity cost and how to calculate it.
Verified Answer
WF
Wanda FernandezJul 19, 2024
Final Answer :
An employee has a per hour total compensation cost of $12.00 and can process 20 orders for $0.60 per order.But it only takes 4/3 touch screens to replace an employee (=20/15)making the opportunity cost per order $0.80 for the touch screen terminal.
Learning Objectives
- Determine the cost per order across various service contexts.
- Understand the concept of opportunity cost and how to calculate it.