Homework Answers
Solution:-
(a). Current labor cost of selling a car = 20 * 8 / 1 Car
= $80
(b). Labor cost when wage = 36
= 36 * 8 / 2 cars
= $144
Labor cost is Lower by = $208 - $144
= $64
Efficiency of labor increased = 1 / 208 = 0.0048
= 1 / 144 = 0.0069
(c).Labor cost when wages is 49
= 49 * 8 / 2.5
= 392 / 2.5
= 156.8
(d). Use $36 per hour $144 per car.
(e). $ 156.8 per car maximizes the productivity
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