The MacJunkin Company manufactures transmission parts. The current process uses 20 workers and produces 400 units per hour. You are considering changing the process with new manufacturing methods that increase output to 470 units per hour but will require 22 workers. Workers are paid at a rate of $15 per hour, and overhead is charged at 140% (or 1.4 times) labor costs. Finished switches sell for $80/unit. The details are as follows: Current Process New Process Output (Units/Hour) 400 470 Number of Workers 20 22 Material (Cost/Hour) $120 $150 A. What is the multifactor productivity ratio for the current process? B. What is the multifactor productivity ratio for the new process?

The MacJunkin Company manufactures transmission parts. The current process uses 20 workers and produces 400 units per hour. You are considering changing the process with new manufacturing methods that increase output to 470 units per hour but will require 22 workers. Workers are paid at a rate of $15 per hour, and overhead is charged at 140% (or 1.4 times) labor costs. Finished switches sell for $80/unit. The details are as follows: Current Process New Process Output (Units/Hour) 400 470 Number of Workers 20 22 Material (Cost/Hour) $120 $150 A. What is the multifactor productivity ratio for the current process? B. What is the multifactor productivity ratio for the new process?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter4: Linear Programming Models

Section4.8: Data Envelopment Analysis (dea)

Problem 41P

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