Suppose customer satisfaction depends on the number of customer service representatives
September 15, 2022
Suppose customer satisfaction depends on the number of customer service representatives
I hire. After careful data collection, I estimate the particular relationship to be:
CS = 70 4R – .2R2.
Where CS = a customer satisfaction score on a scale of 0-100, and R
is the number of customer service representatives I hire. Suppose I
am interested ONLY in maximizing my customer satisfaction score by
choosing a number of customer service representatives.
a) Graph this function and define and describe (in
economic terms!) the intercept and slope.
b) What level of R would maximize CS? What is the
maximum CS score achieved? Show all your work and explain the
economics behind the steps!
c) What could the firm do to increase the intercept from
70 to 80? Explain fully.
2. Describe a real-world relationship between two
variables that you believe is linear. Justify your example. Now
instead provide a real-world example of two variables that are
not related linearly. Again, explain your reasoning.
Graphs are essential write them clearly and label everything!
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