Compute the improvement in multifactor productivity

Assignment Help Business Management

Reference no: EM1377704

Mabel's Ceramics spent $3000 on a new kiln past year, in belief that it would cut energy usage 25 percent over the old kiln. This kiln is an oven that turns "greenware" into finished pottery. Mabel is concerned that the new kiln requires extra labor hours for its operation. Mabel wants to check the energy savings of the new oven, and also to look over other measures of their productivity to see if the change really was beneficial. Mabel has the following data to work with:

Last Year This Year
Production (finished units) 4000 4000
Labor (hrs) 350 375
Capital ($) 15000 18000
Energy (kWh) 3000 2600

Also, assume that the average labor cost is $12 per hour and cost of energy is $0.40 per kwh.
a) Were the modifications beneficial? (Compute labor, energy, and capital productivity for the two years and compare.)
b) Calculate the improvement in multi-factor productivity.
c) By what percentage labor cost must be reduced this year to maintain the same multifactor productivity by reducing labor hours only?

Reference no: EM1377704

Questions Cloud

Calculate the actual running time : Bearing department is considering their schedule for the following week. They require an understanding of last week's performance. The schedule called for two eight hour shifts per day for five days.

Comparing similar products : Working individually or in a team, compare two same items or service industries based on consumer assessment of the consumer requirements for the following production items:

Question about reliability : One of the industrial robots developed by a leading manufacturer of servomechanisms has 4-major components. Their reliabilities are .98, .95, .94, and .90.

Determining fixed costs : Bob and Jane decide to start their own business selling ergonomically correct furniture that Jane has developed. Suppose they operate this business from leased office space near their house.

Compute the improvement in multifactor productivity : Mabel's Ceramics spent $3000 on a new kiln past year, in belief that it would cut energy usage 25 percent over the old kiln. This kiln is an oven that turns "greenware" into finished pottery.

Worker right to know when it comes to drug use : Drug use is data that is rightfully private and only in exceptional cases can an worker claim a right to know about such use.

Construct a pareto diagram : A major music club collected information on the causes for returned shipments during a quarter. Results are: Wrong selection 50,000; wrong address 68,000; refused 195,000;

Determine the point price elasticity of demand : Currently, Roma's Imperial Ministry of Trade and Tourism is selling this book at a value of $68.60 each copy. Determine the point price elasticity of demand.

Find the maximum level of total production : Determine at what level of labor utilization is total production maximized and find the maximum level of total production that this company can attain per month?

User Account

All Pages