Calculate the multifactor productivity measure

Reference no: EM131194999

Your company makes common coffee mugs and you purchased new equipment to improve labor productivity.

For the last few years your production line consisted of six workers earning 10.20 per hour making a 650 cups per hour. The original machines cost \$186 per hour to operate

With the new equipment , you now operate with only five workers earning \$14.45 per hour. The new equipment costs \$214 per hour which allows you to produce a total of 670 cups per hour.

Calculate the multifactor productivity measure for before and after the new equipment (i.e. mugs per dollar cost). Enter the percentage change in productivity as your answer.

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