Question

Cavalier Bike co sells their comfortable style bike for $90. Labor, material and overhead are listed:

  Week 1 Week 2 Week 3 Week 4

#Bikes produced      1,117    1,306   1,092      985

Labor ($) 12,691 14,842 10,563     9,576

Material ($)   21,427   24,523     20,442     18,414

Overheads ($) 9,463   10,530   8,686   7,798

What is the multifactor productivity for each week?

Round your answer to the nearest whole number.

Answer 1

Answer)

Multifactor productivity is given by (the total output)/ (the total input)

For week 1

output = 1117*$90 (as Cavalier Bike co sells their comfortable style bike for $90)

Output = $100530

Input = Labor + Material + Overheads

Input = 12691 + 21427 + 9463 = $43554

Therefore, Multifactor productivity = 100530/43554 = 2.30816916930706

or 2 (rounded to nearest whole number)

For week 2

Output = 1306*90 = 117540

input = 14842+24523+10530 = 49895

Therefore, Multifactor productivity = 117540/49895 = 2.35574706884457

or 2 (rounded to nearest whole number)

For week 3

output = 1092*90 = 98280

input = 10563+20442+8686 = 39691

Therefore, Multifactor productivity = 98280/39691 = 2.47612808949132

or 2 (rounded to nearest whole number)

For week 4

output = 985*90 = 88650

input = 9576+18414+7798 = 35788

Therefore, Multifactor productivity = 88650/35788 = 2.47708729182966

or 2 (rounded to nearest whole number)