Juan's Coffee Shop is purchasing resources out of perfectly competitive resource markets and is a price taker in the coffee market. The price of barista labor is $10 per hour and the marginal productivity of the last barista hired is 15 drinks per hour. The price of custodial labor is $8 per hour. Juan has calculated the marginal productivity of the last custodian hired to be 4 drinks per hour. If the price of a cup of coffee is $1, how should Juan adjust how much barista and custodial labor he is hiring

6. why the aggregate supply curve slopes upward in the short run in the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. several theories explain how this might happen. for example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. consider a soybean farmer who expects a price level of 100 in the coming year. if the actual price level turns out to be 90, soybean prices will , and if the farmer mistakenly assumes that the price of soybeans declined relative to other prices of goods and services, she will respond by the quantity of soybeans supplied. if other producers in this economy mistake changes in the price level for changes in their relative prices, the unexpected decrease in the price level causes the quantity of output supplied to the natural level of output in the short run.