# operation management homework

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10 questions

1.Susan has a part-time business producing seasonal plywood yard ornaments for resale at local craft fairs and bazaars. She currently works 8 hours per day to produce 16 ornaments.

- What is her productivity?
- She thinks that by redesigning the ornaments and switching from use of a wood glue to a hot-glue gun she can increase her total production to 20 ornaments per day. What is her new productivity? (round to one decimal place)
- What is her percentage increase in productivity? %.

2.Carbondale Casting produces cast bronze valves on a 8-person assembly line. On a recent day, 150 valves were produced during an 8-hour shift.

- Calculate the labor productivity of the line.
- John Goodale, the manager at Carbondale, changed the layout and was able to increase production to 200 units per 8-hour shift. What is the new labor productivity per labor-hour?
- What is the percentage of productivity increase? %

3. Charles Lackey operates a bakery in Idaho Falls, Idaho. Because of its excellent product and excellent location, demand has increased by 25% in the last year. On far too many occasions, customers have not been able to purchase the bread of their choice. Because of the size of the store, no new ovens can be added. At a staff meeting, one employee suggested ways to load the ovens differently so that more loaves of bread can be baked at one time. This new process will require that the ovens be loaded by hand, requiring additional manpower. This is the only thing to be changed. The bakery currently makes 1,800 loaves per month. The pay will be $8 per hour for employees and each employee works 160 hours per month. Charles Lackey can also improve the yield by purchasing a new blender. The new blender will mean an increase in his investment. This new blender will mean an increase in his costs of $150 per month, but he will achieve the same new output (an increase to 2,250.00) as the change in labor hours.

a. Current productivity for 640 work hours loaves/dollar =

b. If Charles chooses to increase the number of work hours to 790 in order to employ the new oven loading technique, then the productivity is loaves/dollar

c. By adding manpower, the percentage increase in productivity is %

d. If Charles instead chooses to purchase a new blender (while holding labor constant at 640 hours at $8 per hour), then the productivity is loaves/dollar

e. By purchasing a new blender (while holding labor constant at 640 hours at $8 per hour), the percentage increase in productivity is (comparing the answer in a. to the answer in d.)

4. As part of a study for the Department of Labor Statistics, you are assigned the task of evaluating the improvement in productivity of small businesses. Data for one of the small businesses you are to evaluate is shown below. The data are the monthly average of last year and the monthly average this year. Determine the multi-factor productivity using the following costs:

- labor: $8 per hour;
- capital: 8.3% per month of investment;
- energy: $.60 per BTU

Last Year | This Year | |

Production | 1500 | 1500 |

Labor | 350 | 325 |

Capital | 15000 | 18000 |

Energy | 3000 | 2750 |

a. What is the percent change in the labor productivity? %

b. What is the overall multi-factor productivity change? %

5.A local university is considering changes to its class structure in an effort to increase professor productivity. The old schedule had each professor teaching 5 classes per week, with each class meeting an hour per day on Monday, Wednesday, and Friday. Each class contained 20 students.

The new schedule has each professor teaching only 3 classes, but each class meets daily (Mon.-Fri.) for an hour. New classes contain 50 students.

- Calculate the labor productivity for the initial situation (students/hour).
- Calculate the labor productivity for the schedule change (students/hour).
- What is the change in productivity?

6.Martin Manufacturing has implemented several programs to improve its productivity. They have asked you to evaluate the firm’s productivity by comparing this year’s performance with last year’s. The following data are available:

Last Year | This Year | |

Output | 10,500 units | 12,100 units |

Labor Hours | 12,000 | 13,200 |

Utilities | $7,600 | $8,250 |

Capital | $83,000 | $88,000 |

a. What is the percent change in labor hours this year vs. last year?

b. What is the percent change in utility cost this year vs. last year?

c. What is the percent change in capital investment this year vs. last?

d. What is the overall multi-factor productivity for last year?

e. What is the overall multi-factor productivity this year?

f. What is the multi-factor percent change this year vs. last year?

7. This year, Clearwater Inc., will produce 55,600 hot water heaters at its plants in Harrisburg, PA in order to meet its expected demand. To accomplish this, each laborer at the Clearwater Plant will work 150 hours per month. If the labor productivity at the plant is 0.20 water heaters per labor-hour,

How many heaters can one labor produce every month? and every year

How many laborers are required at the plant to meet the demand?

8. Tabby produces ‘Final Exam Care Packages’ for resale by her sorority. She is currently working a total of 5 hours per day to produce 90 care packages.

What is Tabby’s productivity?

Tabby thinks that by redesigning the package, she can increase her total productivity to 122 care packages per day. What will be her new productivity?

What will be the percentage increase in productivity if Tabby makes the change?

9. In December, Textra Motors produced 16,600 customized SUVs at its plant in New Mexico. The labor productivity at this plant is known to have been 0.18 SUV per labor-hour during that moth. 540 laborers were employed at the plant that month.

How many hours did the average laborer approximately work that month?

If productivity can be increased to 0.21 SUVs per hour, how many hours would the average laborer work that month?

10. Nancy Kirkwood runs a small job shop where garments are made. The job shop employs 8 workers. Each worker is paid $10 per hour. During the first week of March, each worker worked 45 hours. Together, they produced a batch of 132 garments. Of these garments, 52 were “seconds” (meaning that they were flawed). The seconds were sold for $90 each at a factory outlet store. The remaining 80 garments were sold to retail outlets at a price of $198 per garment. What was the labor productivity, in dollars per labor-hour, at this job shop during the first week of March?

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