Problem:

One of the students from Op Management class starts a company that produces baseball bats. He/she is the owner and the only employer in the company. He/she works very hard for 10 hours a day to produce 50 bats a day. He/she thinks that by replacing the paint with some other paint, he/she can produce 60 bats per day. Cost of the wood used to produce one bat is $20; he/she spends $100 per day in necessary supplies (Like shipping of wood, stickers, etc.); electricity cost per day is $300; and he/she values the time at $10 per hour for his/her work.

Required:

Question 1) What is his/her productivity in Number of Bats/hour?

Question 2) What is his/her multi factor productivity with current paint and with new paint in Bats/dollar?

Question 3) What is the percent change in productivity from current to new paint?

Solve the problem and show all work.