Assignment:
I. Productivity. The manager of a crew that installs wood floors has tracked the crew's output over the past several weeks. Each worker works hours per week, and earns $19 per hour. The wholesale cost of lumber to the company is $6 per square foot, and the company charges its customers $21 per square foot of flooring installed.
Week Crew Size Lumber Used (sq. ft) Flooring Installed (sq.ft)
1 6 480 430
2 4 381 335
3 2 260 228
4 5 525 487
a. Calculate labor productivity for each of the weeks shown.
b. Suppose that in addition to cost and wholesale lumber cost the firm's overhead is 140% of its labor cost. Calculate multifactor productivity for each week shown
II. In a few paragraphs, explain why
a. Productivity is important concept to a business or government entity
b. Measuring productivity is also very important to an entity.