Question

Maynard, Joan, Jaco, and Neil are trying to form a band. They each have some basic skills on most instruments, so their current plan is for each of them to rotate among vocals, guitar, bass, and drums. After a year of practice and rehearsals, the band still sounds awful. Maynard can\'t keep a steady beat when on bass or drums, Jaco sounds terrible at everything except the bass, nobody except Joan can remember all the chords on guitar, and even Neil\'s own mother thinks his singing sounds like a dying cow. At their current rate, they expect it will be several years before they are good enough to land their first paid performance. None of them have enough money saved up to last that long. They all know you are taking economics and ask your advice. What would you say to them?
1- Continue with the current plan, as economies of scale should eventually kick in.
2- Have each member specialize in the role that they are best in, to take advantage of benefits from specialization.
3- Abandon the band, as continued practice is doomed to suffer diminishing marginal returns.
4- Invest their remaining savings in new instruments, as they are at a point where the marginal product of capital exceeds the marginal product of labor.
5- Change the rotation to be random rather than equal, to take advantage of heteroskedasticity.

Answer 1

Answer:

2- Have each member specialize in the role that they are best in, to take advantage of benefits from specialization.

Explanation: Having each member specialize in the role that they are best in will make each member have more time to practice on what they are doing best in. Joan for example needs to specialize in the guitar, Jaco needs to specialize in bass,Maynard should focus on drums and Neil should focus on his vocals