Question

1. Various Financial data for 2018 and 2019 follows. Calculate the total productivity measure and the partial measures for labour, raw materials, and energy for this company for both years. What do these measures tell you about this company? [All numbers are in $].

                                                                           2018                                 2019

Output:   Sales                                          $375,000                        $445,000

Input:     Labour                                       127,000                          199,950

              Raw materials                             68,500                           64,250

                 Energy                                            37,250                          47,050

                 Other                                              10,450                           20,200

Answer 1

2018:

Total productivity measure = Total outputs / Total inputs

Total outputs = $ 375,000

Total inputs = $ 127,000 + $ 68,500 + $ 37,250 + $ 10,450 = $ 243,200

Total productivity measure = $ 375,000 / $ 243,200 = 1.54194

Partial productivity of labor = $ 375,000 / $ 127,000 = 2.95276

Partial productivity of raw materials = $ 375,000 / $ 68,500 = 5.47445

Partial productivity of energy = $ 375,000 / $ 37,250 = 10.06711

2019:

Total productivity measure = Total outputs / Total inputs

Total inputs = $ 199,950 + $ 64,250 + $ 47,050 + $ 20,200 = $ 331,450

Total productivity measure = $ 445,000 / $ 331,450 = 1.34259

Partial productivity of labor = $ 445,000 / $ 199,950 = 2.22556

Partial productivity of material = $ 445,000 / $ 64,250 = 6.92607

Partial productivity of energy = $ 445,000 / $ 47,050 = 9.45802

Conclusion : Apart from partial productivity of materials, all other partial productivity ( labor, energy , other)  of different components were reduced and as a result of these total productivity also gets reduced in comparison with previous year .