Question

1.6 George Kyparisis makes bowling ball in his Miami plant. With recent increases in his cost, he has a newfound interest in efficiency. George 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 per Year? He has the following daré representing a month from last year and an equivalent month this year: last year Now Units produced 1,000 1,000 Last (hours) 300 275 Resin (pounded) 50 45 Capital invested ($) 10,000 11.000

Answer 1

Given:

Old productvity:

Labor = 3000

Capital = 10000

Productivity is:

$\begin{gathered} \text{Productivity = }\frac{\text{ Total output}}{\text{ Total input}} \\ =\frac{1000}{(3000+250+100)} \\ =\frac{1000}{3350}= \\ =0.298 \end{gathered}$

New productivity is:

$\begin{gathered} \text{ Productivity = }\frac{\text{ Output}}{\text{ Input}} \\ =\frac{1000}{2750+225+110} \\ =0.32 \end{gathered}$

Change in productivity:

$\begin{gathered} =\frac{0.32-0.298}{0.298}\times100 \\ =2.2\% \end{gathered}$

So productivity increase 2.2%