An industrial plant needs to make 100,000 parts per month to meet demand. Each m
ID: 451430 • Letter: A
Question
An industrial plant needs to make 100,000 parts per month to meet demand. Each month contains 20 working days, each of which allows for 3 separate 8 hour shifts.
a. If a worker can produce 10 parts/hour, how many workers are needed on each shift?
b. If each shift has 100 workers, what is the productivity of an individual worker?
c. If material costs are $10/part, capital costs are $100,000 and labor costs are $10/hour, what is the multifactor productivity of the plant from part A?
Explanation / Answer
a. 100,000 parts * 1 hour / 10 parts * 1 shift / 8 hours * 1 worker/60 shifts = 20.83 = 21 workers
b. 100,000 parts / (60 shifts/worker * 100 workers * 8 hours/shift) = 2.08 parts/hour
c. 100,000 parts / ($10/part * 100,000 parts + $100,000 + 21 workers * 60 shifts/worker * 8 hours/shift*$10/hour) = .083 parts/$1