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Chuck Sox makes wooden boxes in which to ship motorcycles. Chuck and his three employees invest a total of 40 hours per day making the 120 boxes.a) What is their productivity?b) Chuck and his employees have discussed redesigning the process to improve efficiency. If they can increase the rate to 125 per day, what will be their new productivity?c) What will be their unit increase in productivity per hour?d) What will be their percentage change in productivity?

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Answer:

(a) Total time invested = 40 hours per day

No. of boxes produced in a day = 120 boxes

[tex]Productivity\ per\ day=\frac{Number\ of\ boxes\ produced}{Total\ time\ invested}[/tex]

[tex]Productivity\ per\ day=\frac{120}{40}[/tex]

                                          = 3 boxes per labor hour

(b) Expected increase in productivity = 125 boxes

Total time invested = 40 hours per day

[tex]New\ Productivity\ per\ day=\frac{Expected\ increase\ in\ productivity}{Total\ time\ invested}[/tex]

[tex]Productivity\ per\ day=\frac{125}{40}[/tex]

                                          = 3.125 boxes per labor hour

(c)Original productivity of 120 boxes = 3 boxes per labor hour

New productivity of 125 boxes = 3.125 boxes per labor hour

Increase in Productivity = New productivity of 125 boxes - Original productivity of 120 boxes

                                       = 3.125 - 3

                                       = 0.125 boxes per labor hour

Therefore, unit increase in productivity per hour is 0.125 boxes per labor hour.

(d)  [tex]Percentage\ change\ in\ productivity=\frac{New\ productivity\ of\ 125\ boxes-Original\ productivity\ of 120 boxes}{Original\ productivity\ of\ 120\ boxes}\times100[/tex]

[tex]Percentage\ change\ in\ productivity=\frac{3.125-3}{3}\times100[/tex]

                                                                    = 0.041667 × 100

                                                                    = 4.2%

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