Table 1.2 The Abco Company Manufactures Electrical Assemblies. the Current Process Uses

question 61

Multiple Choice

Table 1.2
The Abco Company manufactures electrical assemblies. The current process uses 10 workers and produces 200 units per hour. You are considering changing the process with new assembly methods that increase output to 300 units per hour, but will require 14 workers. Particulars are as follows:

Workers are paid at a rate of $10 per hour, and overhead is charged at 140% (or 1.4 times) labor costs. Finished switches sell for $20 / unit.
-Use the information provided in Table 1.2. What is the multifactor productivity of the current process?

• A) less than or equal to 8.0
• B) greater than 8.0 but less than or equal to 10.0
• C) greater than 10.0 but less than or equal to 12.0
• D) greater than 12.0

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Definitions:

Argentina

A country located in the southern half of South America, known for its diverse landscapes, rich culture, and significant contributions to agriculture and global markets.

World Population

The total number of humans currently living on earth, a figure that is continuously changing due to births and deaths.

Supply Chains

Networks of individuals, organizations, resources, activities, and technology involved in the creation and sale of a product, from the delivery of source materials from the supplier to the manufacturer, and eventually to the end user.

Comparative Advantage

An economic theory that refers to the ability of any given economic actor to produce goods and services at a lower opportunity cost than other economic actors.