Let me try again.
Ignoring the law of diminishing marginal returns, let's suppose your employees A and B can produce 100 units of output from working 4 hours, but can produce 200 units when working 8 hours. The employees are compensated $400/day. Both employees are lazy and will work for 4 hours each, producing 200 units between them.
It makes sense to replace those 2 employees with employee C who can can also produce 100 units of output from working 4 hours or 200 units when working 8 hours. He chooses to work 8 hours, and now the employer can compensate him up to $799.99/day, maintain the same level of output, and still save on labor costs. Ideally he will compensate the employee $400 and save $400 each day.
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My Japanese alter-ego.
Hey all this is Bartz btw.