AN 300 Practice Exam 1 UKY 65 Questions with
Verified Answers
Own its raw material sources, factories, and product distribution system -
CORRECT ANSWER A company that is highly vertically integrated will
Decreasing inputs while holding outputs steady - CORRECT ANSWER Productivity
can be improved by
Outputs = $90 Million, inputs = $50 Million - CORRECT ANSWER Suppose that C&A
produced $100 Million worth of outputs while inputs totaled $50 Million in year 1.
For which of the following values in year 2 would productivity decrease?
good output = 500 x (1-15%) = 425
input = 5x5 hours or input = 5 workers
productivity = 425/25 = 17 units per hour or 425/5 = 85 units per worker.
Consider only non-defective output in computing productivity.
Pay attention to the unit of input when computing productivity. - CORRECT
ANSWER A firm produces 500 units per day using five workers on a five-hour shift.
On average, 15% of the units produced are defective and must be scrapped. What
is the labor productivity? Check all that apply.
0.244 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month.
Labor productivity is 2.344 loaves per labor-hour. Each worker works 160 hours
,per month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35
per loaf. What is C&A's multi-factor productivity?
4 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month. Labor
productivity is 2.344 loaves per labor-hour. Each worker works 160 hours per
month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35 per
loaf. How many workers does C&A currently use?
1 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month. Labor
productivity is 2.344 loaves per labor-hour. Each worker works 160 hours per
month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35 per
loaf. How many workers will C&A need to add in order to meet an anticipated 25%
increase in bread demand?
78% - CORRECT ANSWER Aztec Furnishings makes hand-crafted furniture for sale
in its retail stores. The furniture maker has recently installed a new assembly
process, including a new sander and polisher. With this new system, production
has increased to 90 pieces of furniture per day from the previous 60 pieces of
furniture per day. The number of defective items produced has dropped from 10
pieces per day to 1 per day. The production facility operates strictly eight hours
per day. Evaluate the change in productivity for Aztec using the new assembly
process.
0.49
old output = 60x$31 = $1860 per hour
old input = 5x$12 + 60x$16 + 1.6x5x$12 = $1116 per hour
old productivity = 1860/1116 = 1.667
new output = 60x1.25x$31 = $2325 per hour
, new input = 6x$12 + 75x$10 + 1.6x6x$12 = $937.2 per hour
new productivity = 2325/937.2 = 2.481
change in productivity = (2.481-1.667)/1.667 = 0.49 - CORRECT ANSWER A
company has introduced a process improvement that reduces processing time for
each unit, so that output is increased by 25% with less material, but one
additional worker required. Under the old process, five workers could produce 60
units per hour. Labor costs are $12/hour, and material input was previously
$16/unit. For the new process, material is now $10/unit. Overhead is charged at
1.6 times direct labor cost. Finished units sell for $31 each. What is the change in
productivity associated with the process improvement?
34.62% decrease - CORRECT ANSWER If inputs increase by 30% and outputs
decrease by 15%, what is the percentage change in productivity?
Assume old productivity and old labor costs are both one. Compute new
productivity and new labor costs with the information given. The value of the new
output can then be calculated by multiplying new productivity with new labor
costs. The change in output is then the result of new output -1.
Answer: -33.44
Review demo problem 2 but rearrange the productivity formula to output =
productivity x inputs since you are computing the percent change in output this
time. - CORRECT ANSWER Productivity was up 32% in 2015 while labor costs fell
44%. What was the percent change in output?
Deciding how to allocate overhead - CORRECT ANSWER For which of the following
is break-even analysis not appropriate?
Verified Answers
Own its raw material sources, factories, and product distribution system -
CORRECT ANSWER A company that is highly vertically integrated will
Decreasing inputs while holding outputs steady - CORRECT ANSWER Productivity
can be improved by
Outputs = $90 Million, inputs = $50 Million - CORRECT ANSWER Suppose that C&A
produced $100 Million worth of outputs while inputs totaled $50 Million in year 1.
For which of the following values in year 2 would productivity decrease?
good output = 500 x (1-15%) = 425
input = 5x5 hours or input = 5 workers
productivity = 425/25 = 17 units per hour or 425/5 = 85 units per worker.
Consider only non-defective output in computing productivity.
Pay attention to the unit of input when computing productivity. - CORRECT
ANSWER A firm produces 500 units per day using five workers on a five-hour shift.
On average, 15% of the units produced are defective and must be scrapped. What
is the labor productivity? Check all that apply.
0.244 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month.
Labor productivity is 2.344 loaves per labor-hour. Each worker works 160 hours
,per month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35
per loaf. What is C&A's multi-factor productivity?
4 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month. Labor
productivity is 2.344 loaves per labor-hour. Each worker works 160 hours per
month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35 per
loaf. How many workers does C&A currently use?
1 - CORRECT ANSWER C&A bakery produces 1500 loaves of bread a month. Labor
productivity is 2.344 loaves per labor-hour. Each worker works 160 hours per
month for $8 per hour. Utility costs $500 per month. Ingredients cost $0.35 per
loaf. How many workers will C&A need to add in order to meet an anticipated 25%
increase in bread demand?
78% - CORRECT ANSWER Aztec Furnishings makes hand-crafted furniture for sale
in its retail stores. The furniture maker has recently installed a new assembly
process, including a new sander and polisher. With this new system, production
has increased to 90 pieces of furniture per day from the previous 60 pieces of
furniture per day. The number of defective items produced has dropped from 10
pieces per day to 1 per day. The production facility operates strictly eight hours
per day. Evaluate the change in productivity for Aztec using the new assembly
process.
0.49
old output = 60x$31 = $1860 per hour
old input = 5x$12 + 60x$16 + 1.6x5x$12 = $1116 per hour
old productivity = 1860/1116 = 1.667
new output = 60x1.25x$31 = $2325 per hour
, new input = 6x$12 + 75x$10 + 1.6x6x$12 = $937.2 per hour
new productivity = 2325/937.2 = 2.481
change in productivity = (2.481-1.667)/1.667 = 0.49 - CORRECT ANSWER A
company has introduced a process improvement that reduces processing time for
each unit, so that output is increased by 25% with less material, but one
additional worker required. Under the old process, five workers could produce 60
units per hour. Labor costs are $12/hour, and material input was previously
$16/unit. For the new process, material is now $10/unit. Overhead is charged at
1.6 times direct labor cost. Finished units sell for $31 each. What is the change in
productivity associated with the process improvement?
34.62% decrease - CORRECT ANSWER If inputs increase by 30% and outputs
decrease by 15%, what is the percentage change in productivity?
Assume old productivity and old labor costs are both one. Compute new
productivity and new labor costs with the information given. The value of the new
output can then be calculated by multiplying new productivity with new labor
costs. The change in output is then the result of new output -1.
Answer: -33.44
Review demo problem 2 but rearrange the productivity formula to output =
productivity x inputs since you are computing the percent change in output this
time. - CORRECT ANSWER Productivity was up 32% in 2015 while labor costs fell
44%. What was the percent change in output?
Deciding how to allocate overhead - CORRECT ANSWER For which of the following
is break-even analysis not appropriate?
