David Upton is president of Upton Manufacturing, a producer of Go-Karts tires. Upton makes 1500 tires per day with the following resources: Labor: 500 hours per day @ $12.50 per hour Raw Material: 20,000 lbs. per day at @ $2 per lb Energy: $5,000 per day Capital: $10,000 per day
What is the labor productivity in labor hours for these tires?
What is the multifactor productivity for these tires?
What is the percent change in the multifactor productivity if the energy bill can be reduced by $1,000 without cutting production or changing any other inputs?