A property title search firm is contemplating using online software to increase
ID: 422565 • Letter: A
Question
A property title search firm is contemplating using online software to increase its search productivity. Currently an average of 50 minutes is needed to do a title search. The researcher cost is $2.20 per minute. Clients are charged a fee of $470. Company A's software would reduce the average search time by 8 minutes, at a cost of $3.10 per search. Company B's software would reduce the average search time by 12 minutes at a cost of $5.10 per search. a Calculate the productivity in terms of revenue per dollar of input. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) (Revenue per Dollar Input) $ 4.27 Approach Current Company A Company B Which option would have the highest productivity in terms of revenue per dollar of input? b. Company A Company B CurrentExplanation / Answer
>Current
Dollars of input = 50*2.2 = $110
Revenue = $470
Productivity = 470/110 = 4.27
>Company A
Dollars of input = 42*2.2+3.10 = $95.5
Revenue = $470
Productivity = 470/95.5 = 4.92
>Company B
Dollars of input = 38*2.2+5.1 = $88.7
Revenue = $470
Productivity = 470/88.7 = 5.3
(b)
Company B has the highest productivity