A company offers ID theft protection using leads obtained from client banks. Three employees each work 50 hours a week on the leads. These employees are each paid $25 per hour. Each employee identifies an average of 3,000 potential leads a week. There are no duplications in these three lists. An average of 4 percent of the potential leads actually sign up for the service, paying a one-time fee of $75. Material costs are $1,500 per week, and overhead costs are $9,000 per week. Consider the output as the fees generated.
a) What are the labor hours productivity and the multifactor productivity for this operation?
b) From the results in a) suppose the company wants to improve the multifactor productivity by 10% by reducing the labor hours used. What must the reduction in labor hours per employee per week be to achieve this goal?