The number of plumbing repair jobs performed by Augur\'s Plumbing Service in eac
ID: 467245 • Letter: T
Question
The number of plumbing repair jobs performed by Augur's Plumbing Service in each of the last six months is listed below. a. Draw the scatter diagram for these data b. Explain whether there is evidence supporting the argument that one or more of the following of the following are present: (1) trend; (2) cycle; (3) seasonal effect. c. Forecast the number of repair jobs Augur's will perform in August using two different naive methods. II. The manager of a crew that installs wood floors has tracked the crew's output over the past two weeks. Each worker works 40 hours per week, and earns $15 per hour. The wholesale cost of lumber to the company is $9 per square foot, and the company charges its customers $20 per square foot of flooring installed. a. Calculate labor productivity for each week. b. Suppose that in addition to labor cost and wholesale lumber cost, the firm's overhead is 100% of its labor cost. Calculate multifactor productivity for each week.Explanation / Answer
a. Scatter Diagram is as below
b. Yes, as visible in the data, there's an effect of seasonality. There's a spike in demand in the month of May, preceded by a gradual rise and followed by a gradual fall. There's also a potential cyclical trend.
c. Forecast using Naive methods
First method is based on most recent. So forecast for the month of August is equal to the most recent Actual value. so Forecast of August = 75
Second method is based on average of observed values. So forecast for the month of August is equal to the average of the last six months observed (actual) value. so Forecast of August = (75 + 78 + 79 + 80 + 78 + 75)/6 = 77.5
II) a). Labor productivity for week 1 = 4*40 / 420 = 0.381 hours per square feet of flooring
Labor productivity for week 2 = 4*30 / 325 = 0.369 hours per square feet of flooring
b) Multifactor productivity in $ per square feet of flooring installed is calculated below by dividing the total cost by square feet of flooring installed.
Week Crew Size Lumber used Total labor hours Labor cost Lumber cost Overhead cost Total cost Flooring installed multifactor productivity 1 4 480 160 2400 4320 2400 9120 420 21.71 2 3 371 120 1800 3339 1800 6939 325 21.35