Question

A textile factory in the United States pays 300 workers a total of $9 million each year to produce 4.5 million shirts. A foreign factory employs 225 workers at a total cost of $1,050,000 to produce 2,500,000 shirts. How do the labor costs per shirt of the American and foreign factory compare?

Answer 1

Answer:

$2 and $0.42 per shirt.

Explanation:

Given: US factory produce 4.5 million shirts.

           Total cost of producing shirts is $9 million.

            Foreign factory produce 2500000 shirts.

            Total cost of producing shirts is $ 1050000.

As we know cost of producing 4.5 million shirts is $9 million

So, we will unitary method for finding cost of one shirt.

∴ Cost of 1 shirt produced = $\frac{9}{4.5} = \ 2\ per\ shirt$

∴Cost of producing 1 shirt by US´s textile factory is $2.

Similarly, as cost of producing 2500000 shirts by foreign factory is $1050000.

∴Cost of 1 shirt produced = $\frac{1050000}{2500000} = \ 0.42\ per\ shirt$

∴Cost of producing 1 shirt by foreign textile factory is $0.42.

The labour cost per shirt of America and foreign factory is $\ 2\ and\ \ 0.42$ respectively.