Greatest impact on multifactor productivity measure

Assignment Help Operation Management

Reference no: EM132140316

Mack's guitar fabrication shop produces low cost, highly durable guitars for beginners. Typically, out of the 100 guitars that begin production each month, only 80 percent are considered good enough to sell. The other 20 percent are scrapped due to quality problems that are identified after they have completed the production process. Each guitar sells for $250. Because some of the production process is automated, each guitar only requires 10 labor hours. Each employee works an average of 160 hours per month. Labor is paid at $99 per hour, materials cost is $42 per guitar, and overhead is $4200.

a. Calculate the multifactor productivity ratios

b. After some study, the operation manager Darren Funk recommends three options to improve the company's multifactor productivity: 1. increase the sales price by 10%, 2. Improve quality so that only 10 percent are defective, or 3. reduce labor, material, and overhead costs by 10 percent. Which option has the greatest impact on the multifactor productivity measure?

Reference no: EM132140316

Questions Cloud

Employer for violating the family and medical leave act : Can Jack sue his former employer for violating the Family and Medical Leave Act (FMLA) by failing to reinstate him in the company?

Key concepts and terms from this week readings : Provide a legal analysis of your decision using key concepts and terms from this week’s readings.

What questions do you have about the project : There is no better time than now to begin thinking about the Applied Research Project, required at the end of the DSL.

What resonated with your own ignorance of rape : What happens in society at large in any group when the topic of victims arises? Use the technique of free association and then analyze the thoughts.

Greatest impact on multifactor productivity measure : Calculate the multifactor productivity ratios. Which option has the greatest impact on the multifactor productivity measure?

Information technology has had negative impact : Information technology has had a negative impact on _______________.

What happens in society at large in any group : What happens in society at large in any group when the topic of victims arises? Use the technique of free association and then analyze the thoughts behind.

What is the basic premise of abraham maslow : What is the basic premise of Abraham Maslow's hierarchy of needs theory and what levels comprise the hierarchy?

Identify three decision making biases and errors : Identify three decision making biases and errors. Explain why each bias or error you identified can have a negative effect on decision making.

User Account

All Pages