Consider the following scenario: Because inflation has risen, a clothing company decides to issue a new printed catalog monthly
1 answer:
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Answer:
a. Blacksburg
b. Blacksburg
Explanation:
a. Productivity is measured by how much output is derived per input.
= Output/Input
= Sales Volume/Labor Hours
Annandele = 40,000/250
= $160 per hour
Blacksburg = 12,000/60
= $200 per hour
Charlottesville = 60,000/500
= $120
Danville = 25,000/250
= $100
<em>Blacksburg</em><em> is most productive at $200 per labor hour. </em>
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b. Multifactor productivity would incorporate the other costs such as labor rate and rent.
= Sales volume / ( Rent + Labor cost)
Annandale = 4,0000/ (2,800 + 250 * 10)
= $7.5
Blacksburg = 12,000 / (1,200 + 60 * 7.25)
= $7
Charlottesville = 60,000/ ( 2,000 + 500 * 8)
= $10
Danville = 25,000 / ( 800 + 200 * 7.50)
= $10.86
<em>Blacksberg</em><em> is least productive using Multifactor so should be closed down. </em>
