Discuss the below:
Q: Lillian Fok is president of Lakefront Manufacturing, a producer of bicycle tires. Fok makes 1.000 tires per day with the following resources
Labor:425 hours per day@ 12.50 per hour
Raw material:21000 pounds per day @$1.00 per pound
Energy:$5250 per day
Capital:$1050 per day
Labor productivity per labor hour for these tires tires/labor hour
Multifactor productivity for these tires = tires/dollar
The percent change in multifactor productivity if Fok can reduce the energy bill by $1.000 per day without cutting production or changing any other inputs