Brown’s a local bakery, is worried about increased cost particularly energy. Last year records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner does not believe things have changed much, but she did invest an additional $3000 for modification to the bakery’s ovens to make them more energy efficient. The modifications were supposed to make the ovens at least 20% more efficient. Brown has asked you to check the energy savings of the new ovens and also to look over other measures of the bakery’s productivity to see if the modifications were beneficial. You have the following data to work with.
Production (dozen) last year 1,500 now 1,500. Labor (hours) last year 340 now 320. Capital Investment($) last year 15,000 now 18,000. Energy (BTU) last year 3,000 now 2,800.
Energy productivity increase
Capital productivity increase