Principles of Operations Management: Sustainability and Supply Chain Management 10th Global Edition
Diff: 2
Key Term: Productivity
AACSB: Analytical thinking
LO: 1.4 Compute single-factor productivity
107) Martin Manufacturing has implemented several programs to improve its productivity. They have asked you to evaluate the firm's productivity by comparing this year's performance with last year's. The following data are available:
| Last Year | This Year | |
| Output | 10,500 units | 12,100 units |
| Labor Hours | 12,000 | 13,200 |
| Utilities | $7,600 | $8,250 |
| Capital | $83,000 | $88,000 |
Has Martin Manufacturing improved its productivity during the past year?
Answer: Productivity improved in all three categories this year; utilities showed the greatest increase, and labor the least.
| Resource | Last Year | This Year | Change | Pct. Change |
| Labor | 10500 / 12000 = 0.88 | 12100 / 13200 = 0.92 | 0.04 | 4.55% |
| Utilities | 10500 / 83000 = 0.13 | 12100 / 88000 = 0.14 | 0.01 | 7.69% |
| Capital | 10500 / 7600 = 1.38 | 12100 / 8250 = 1.47 | 0.09 | 6.52% |
Diff: 2
Key Term: Productivity
AACSB: Analytical thinking
LO: 1.4 Compute single-factor productivity
108) Felicien grows mirlitons (that's Cajun for Chayote squash) in his 100 by 100 foot garden. He then sells the crop at the local farmers' market. Two summers ago, he was able to produce and sell 1200 pounds of mirlitons. Last summer, he tried a new fertilizer that promised a 50% increase in yield. He harvested 1900 pounds. Did the fertilizer live up to its promise?
Answer: Since the productivity gain was 58.3%, not 50%, the fertilizer was at least as good as advertised.
| Two Summers ago | Last Summer | Change |
| 1200 ÷ 10,000 = .12 1bs/sq. ft | 1900 ÷ 10,000 = .19 lbs/sq. ft | (.19 - .12) ÷ .12 = 58.3% |
Diff: 2
Key Term: Productivity
AACSB: Analytical thinking
LO: 1.4 Compute single-factor productivity
109) The Dulac Box plant produces wooden packing boxes to be used in the local seafood industry. Current operations allow the company to make 500 boxes per day, in two 8-hour shifts (250 boxes per shift). The company has introduced some moderate changes in equipment, and conducted appropriate job training, so that production levels have risen to 300 boxes per shift. Labor costs average $10 per hour for each of the 5 full-time workers on each shift. Capital costs were previously $3,000 per day, and rose to $3,200 per day with the equipment modifications. Energy costs were unchanged by the modifications, at $400 per day. What is the firm's multifactor productivity before and after the changes?