Final answer:
Christopher's Cranks evaluates production technologies based on total costs, with an inclination to choose a mechanized approach for cost reduction and quality consistency. Changes in labor or machine costs directly influence the choice between more labor-intensive or more machine-centric production methods. The firm aims to reduce costs and improve quality control, and may favor machines to avoid labor disruptions.
Step-by-step explanation:
When a firm is considering different production technologies, it must evaluate the total costs associated with each option. In the case of Christopher's Cranks, the adoption of machinery is analyzed with respect to reducing costs, quality control, customer service, and employee training. If the company finds that machine hours are becoming cheaper, as indicated, it may opt for a production technology that relies more heavily on machines. The reason behind this choice is that a mechanized work environment can potentially lead to lowered costs and increased consistency in product quality across locations.
For instance, if initially, the production technology used involves 50 hours of labor at a certain wage and one machine with a fixed manufacturing cost, we calculate the total cost incurred. If labor costs increase due to factors such as union negotiations, the total cost of production might remain the same whether more labor hours or more machines are used. However, the firm could still prefer the use of machines because they are less likely to cause disruptions compared to human labor. Conversely, if the cost of machines increases, the firm might shift towards a production technology that uses less capital and more labor to keep its total costs low.
Ultimately, Christopher's Cranks must evaluate the total cost implications of different production technologies and consider additional factors such as managing the risk of strikes, the purchasing power of its workforce, and the flexibility provided by human labor versus machines. The decision to use more machines may lead to cost savings and avoid potential labor disputes, aligning with the original goal to minimize expenses and maintain product quality control.