Question

Compute the multifactor productivity measure for an eight-hour day in which the usable output was 300 units, produced by three workers who used 600 pounds of materials. Workers have an hourly wage of $20, and material cost is $1 per pound. Overhead is 1.5 times labor cost.

Answer 1

Compute the multifactor productivity measure for an. ... materials. Workers have an hourly wage of $20, and material cost is $1 per pound. Overhead is 1.5 times labor cost. Labor cost ...

Answer 2

The answer is $\frac{1}{6}$.

Given:

Eight hour day

Usable output is 300 units

Weight of materials output = 600 pounds

Hourly wage of 3 workers each = 20

Overhead cost is 1.5 times the labour cost

To Find:

The multifactor productivity measure

Solution:

The total labour cost is $3*8*20=480$

Hence the overhead cost is $1.5*480=720$

The materials cost is $600*1=600$

The multifactor productivity measure is given by

$\frac {Out put}{materials+labour+overhead} = \frac{300}{480+720+600} =\frac{1}{6}$

The multifactor productivity measure is $\frac{1}{6}$.

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