Bob Lee, a division manager for JTCL Ltd has been given a mandate to control costs. Bob’s division is called the Murray Division. After taking an Operations Management class he remembered that a good place to start would be to get a current measure of his division's productivity. The Murray Division is comprised of 6 employees who are paid $10 hourly and work 40 hours per week. The division used 75 pounds of material during the week he is studying. Each week JTCL Ltd assigns an overhead charge of $5,000 to the Murray Division. Material costs $10 per pound. The division completed 9000 units of product last week. Suppose that this week all costs and conditions at the Murray Division are exactly the same as last week, with the exception of material usage. If the employees only use 55 pounds of materials this week, producing 9000 units of output under the same conditions, how will this impact on Murray Division’s multifactor productivity?
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Bob Lee, a division manager for JTCL Ltd has been given a mandate to control costs. Bob’s division i...
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