A Grocery Chain Is Considering the Installation of a Set

question 79

Essay

A grocery chain is considering the installation of a set of 4 self-checkout lanes. The new self-checkout lane setup will replace 2 old cashier lanes that were staffed by a cashier and bagger on each lane. One cashier mans all 4 self-checkouts (answering questions, checking for un-scanned items, taking coupons, etc). Checkout on the new lanes takes 2 minutes (customers bag their own orders) while checkout with the old lanes took only 45 seconds. In addition, the electricity costs for both setups are $0.05 per checkout while bagging (material) costs are $0.10 per checkout with the old system and $0.15 for the new system. The new lanes also require $100/shift in capital costs. Assume that the lanes are always in use for 8 hours per day (1 shift) and that a worker makes $10/hour.
(a) How many checkouts did the old system provide in a shift?
(b) How many checkouts does the new system provide?
(c) What is the multifactor productivity for each system?

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Definitions:

Pith

The innermost tissue in the stems and roots of many herbaceous plants; primarily a storage tissue.

Vascular Cambium

A layer of meristematic tissue in plants that produces vascular tissues, contributing to the thickness growth of stems and roots.

Secondary Xylem

The part of the xylem that is formed after the plant's initial growth, contributing to the thickening of the plant stem.

Primary Phloem

The part of the plant's vascular system that conducts sugars and other metabolic products downward from the leaves.