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Problem Statements Chapter 1 - Productivity

This document contains 6 problems related to productivity analysis. Problem 1 asks about the productivity of a manufacturer making 120 boxes per day in 40 hours and how productivity would change if output increased to 125 boxes. Problem 2 provides data on units produced, labor hours, materials and energy used from last year and this year for a company and asks to calculate the productivity change. Problem 3 builds on Problem 2 by providing input costs and asks to calculate multifactor productivity. Problem 4 gives data on a bakery's output and labor productivity last year and this year, and asks how many workers would be needed if output increased by 25%. Problem 5 provides additional details for Problem 4, including the cost of a potential investment to improve productivity without adding workers. Problem

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233 views

Problem Statements Chapter 1 - Productivity

This document contains 6 problems related to productivity analysis. Problem 1 asks about the productivity of a manufacturer making 120 boxes per day in 40 hours and how productivity would change if output increased to 125 boxes. Problem 2 provides data on units produced, labor hours, materials and energy used from last year and this year for a company and asks to calculate the productivity change. Problem 3 builds on Problem 2 by providing input costs and asks to calculate multifactor productivity. Problem 4 gives data on a bakery's output and labor productivity last year and this year, and asks how many workers would be needed if output increased by 25%. Problem 5 provides additional details for Problem 4, including the cost of a potential investment to improve productivity without adding workers. Problem

Uploaded by

Stone
Copyright
© © All Rights Reserved
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Download as DOCX, PDF, TXT or read online on Scribd
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Problems Chapter 1

P 1.- A manufacturer of boxes spend 40 hours per day making 120 boxes.

a) What is his productivity?


b) The company has thought to redesign the process to improve efficiency. If they
could increase the rate to 125 boxes per day, what would be the productivity?
c) What would also be the increase in productivity?

P 2.- A billiard balls producer has a newfond interest in efficiency and is interested in
determining the productivity of his organization. He would like to know if his organization
is maintaining the manufacturing average of 3% increase in productivity. He has the
following data representing a month last year and an equivalent month this year.

Last year Now


Units produced 1 000 1 000
Labour (hours) 300 275
Resin (pounds) 50 45
Capital invested ($) 10 000 11 000
Energy (BTU) 3 000 2 850

Determine the productivity change for each category and then determine the
improvement for labour-hours, the typical standard of comparison.

P 3.- With regard to above problem P 2., if the cost of inputs are:

 Labour $10 per hour.


 Resin $5 per pound.
 Capital 1% per month of investment.
 Energy $0.50 per BTU.

What’s the multifactor productivity in both cases?

P 4.- A bakery has increased his demand by 25% in the last year. On far too many occasions
customers have not been able to purchase the bread of their choice. Because of the size
of the store no new ovens can be added.

At a staff meeting an employee suggested to load the ovens differently so that more
loaves of bread can be baked at one time. The new process will require additional
manpower to load the ovens.
If the bakery made 1 500 loaves this month last year with, a labour productivity of 2.344
loaves per labour-hour, how many workers will be needed? Assume the same productivity
ratio per labour-hour and that each worker works 160 hours per month.

P 5.- With regard to problem P 4., the salary per employee is $8 per hour. The yield can also be
improved (without increasing the labor force) by purchasing a new blender which would
imply an investment increase. This added investment has a cost of $100 per month and it
could perform the same output (1 875 loaves). What is the best decision?

P 6.- With regard to above problems P4. and P5., if the utility costs remain constant at $500
per month, labour at $8 per hour and cost of ingredients at 0.35 $/loave, what will be the
multifactor productivity in all 3 cases: initial situation, increasing the labour force, and
purchasing the blender.

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