As part of a study for the Department of Labor Statistics, you are assigned the
ID: 459152 • Letter: A
Question
As part of a study for the Department of Labor Statistics, you are assigned the task of evaluating the improvement in productivity of small businessesAs part of a study for the Department of Labor Sta. Data for one of the small businesses you are to evaluate is shown below. The data are the monthly average of last year and the monthly average this year. Determine the multifactor productivity using the following costs:Labor :$8 per hour Capital; 0.83% per month of investment Energy; $0.60 per BTU
Monthly Average
Production(dozen). Last year. This year
1500 1500
Labor (hours). 350 325
Capital investment($). 15000 18000
Energy 3000 2750
A. Compute the multiproductivity for last year B. Compute the multiproductivity for this year C. Determine the rate of increase or decrease between the years . As part of a study for the Department of Labor Statistics, you are assigned the task of evaluating the improvement in productivity of small businessesAs part of a study for the Department of Labor Sta. Data for one of the small businesses you are to evaluate is shown below. The data are the monthly average of last year and the monthly average this year. Determine the multifactor productivity using the following costs:
Labor :$8 per hour Capital; 0.83% per month of investment Energy; $0.60 per BTU
Monthly Average
Production(dozen). Last year. This year
1500 1500
Labor (hours). 350 325
Capital investment($). 15000 18000
Energy 3000 2750
A. Compute the multiproductivity for last year B. Compute the multiproductivity for this year C. Determine the rate of increase or decrease between the years . As part of a study for the Department of Labor Statistics, you are assigned the task of evaluating the improvement in productivity of small businessesAs part of a study for the Department of Labor Sta. Data for one of the small businesses you are to evaluate is shown below. The data are the monthly average of last year and the monthly average this year. Determine the multifactor productivity using the following costs:
Labor :$8 per hour Capital; 0.83% per month of investment Energy; $0.60 per BTU
Monthly Average
Production(dozen). Last year. This year
1500 1500
Labor (hours). 350 325
Capital investment($). 15000 18000
Energy 3000 2750
A. Compute the multiproductivity for last year B. Compute the multiproductivity for this year C. Determine the rate of increase or decrease between the years .
Explanation / Answer
Following is the formula for multiproductivity
Multiproductivity = Input / Output
a) Calculation of multiproductivity for last year is as follows
Total Output = 1500 x 12
= 18,000
Total Input = Labor + Investment + Energy
Labor = 350 x $8
= $2,800
Capital Investment = 0.83% x 15000 x 12
= $1494
Energy = 0.6 x 3000
= $1,800
Total Input = 2800 + 1494 + 1800
= $6,094
Multiproductivity = 18000 / 6094
= $2.95
The multiproductivity for last year is $2.95
b) Calculation of multiproductivity for this year is as follows
Total Output = 1500 x 12
= 18,000
Total Input = Labor + Investment + Energy
Labor = 325 x $8
= $2,600
Capital Investment = 0.83% x 18000 x 12
= $1793
Energy = 0.6 x 2750
= $1,650
Total Input = 2600 + 1793 + 1650
= $6,043
Multiproductivity = 18000 / 6043
= $2.98
The multiproductivity for this year is $2.98
c) Rate of Increase = (2.98 - 2.95) / 2.95
= 0.01
There is 1% increase in productivity.
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