Question

Hokey Min's Kleen Karpet cleaned 75 rugs in October, consuming the following resources: Labor: Solvent Machine Rental: 520 hours at $15 per hour 100 gallons at $5 per gallon 22 days at $75 per day

a) Labor productivity per dollar= 0.0096 rugs/dollar (round your response to four decimal places).
b) Multifactor productivity_______-

Answer 1

0.0075 rugs per dollar

Step-by-step explanation:

(b)

Total labor cost:

= 520 hours × $15 per hour

= $7,800

Total solvent cost:

= 100 gallons × $5 per gallon

= $500

Total machine rental cost:

= 22 days × $75 per day

= $1,650

Multi-factor productivity:

= Number of rugs ÷ (Total labor cost + Total solvent cost + Total machine rental cost)

= 75 ÷ ($7,800 + $500 + $1,650)

= 75 ÷ $9,950

= 0.0075 rugs per dollar