Page 21 Prob 1.1 John Lucy makes wooden boxes in which to ship motorcycles. John and his three employees invest 40 hours per day making the 120 boxes a) Productivi Productivity ty = 120/40 120/40 = 3 units/ units/labor labor-hour -hour b) New productiv productivity ity = 1125/40 1125/40 = 3.125 units/l units/labor abor-hour -hour c) Increase Increase in produc productivit tivity y = 0.125 0.125 units/ units/ labor-ho labor-hour ur
Prob 1.6 Units produced remain the same Decrease in labor hours spent for 8.33% (from 300 to 275) Old Productivity = 1000/300=3.33 units per labor hour New productivity = 1000/275=3.63 units per labor hour The difference is an increase in units per labor hour for 0.3 or 0.9% Decrease in use of (raw material) Resin for 10 % (from 50 to 45) Old Productivity= 1000/50=20 units per pounds resin New productivity=1000/45=22.22 productivity=1000/45=22.22 units per pounds resin Productivity difference= 0.22 or 11.1% 11.1% Increase in capital invested for 10 % (from 10000 to 11000) Old Productivity=1000/10000=0.1 Productivity=1000/10000=0.1 units per dollar New productivity= 1000/11000=0.09 units per dollar Productivity difference= 0.01 or 11.1% Decrease in use of energy for 5 % (from 3000 BTU to 2850 BTU) Old Productivity=1000/3000=0.33 Productivity=1000/3000=0.33 units per BTU New productivity=1000/2850=0.35 productivity=1000/2850=0.35 units per BTU Productivity difference= 0.02 or 0.6%
Prob 1.13 25% increase in demand How many workers should be added? Productivity = 2.344 = 1500/labor-hours used Labor-hour used= 640 hours (considered per month) It is given that the worker works 160 hours per month then the bakery has 640/160=4 workers, In order to increase the output by 25%, one more worker should be added: 25% of 4 is =1 or 25% + 1500= 1875 loaves to be produced then 375 loaves to be added
These 375 loaves how many hours they need to be produced? 375/2.344= 160hours (this is the hours spent by one worker per month) We need just one more worker to perform these 160hours of productivity
Prob 1.14 What to choose: to add one labor or add a blender a) productivity in loaves per dollar with an increase in labor cost: With 4 workers: 640 hours and $8 per hour: Productivity = 1500/5120= 0.29 loaves per dollar With 5 workers: 800hours and $8/hour: Productivity=1875/6400= 0.29 loaves per dollar b) productivity change with only an increase in investment ($100 / month) Without the increase: 1500/5120=0.29 loaves per dollar With the increase: 1875/5120+100= 0.359 loaves per dollar The decision would be better to invest $100 in a blender than to employ a worker
Prob 1.15 I am supposing 1 loaf takes 1 pound of ingredients For 1500 loaves produced: Productivity = 1500/500 + 640*8 + 0.35*1500 = 1500/6145=0.244 loaves per dollar For 1875 loaves produced: Productivity = 1875/500 + 800*8 + 0.35*1875= 1875/7556.25=0.248 loaves per dollar The increase in productivity is 0.004 or 1.6%
