Question

Productivity A greeting card company produced 2,000 cards per hour. The standard selling price was $2/card. Labour costs were $160/hr, material costs were $50/hr, and overheads were $320/hr. Determine: i) the labour productivity ii) the multifactor productivity

(b) Quality The Taguchi quality loss function measures the value lost with deviation from the target quality and is generally represented by the equation: L(y) = k(y-m)2, where L(y) = Loss ($); k = constant = (cost to correct/tolerance2); y = reported value and m = mean value (average).

You have a batch of 40 shaft bearings with a specification external diameter of 100 mm. The average value actually turns out to be 106 mm with a standard deviation of 5 mm. It costs $5.00 to re-machine just one bearing, which had a dimension of 102 mm. What is the total cost of re-machining the whole batch to specification?

Answer 1

Number of cards produced per hour 2,000 cards The standard selling price was $2/card Revenue generated per hour- 2,000cards x $2/card $4,000 Labour costs per hour-$160 Material costs per hour=$50, Overheads per hour-$320 Cost of producing 2,000 cards (per hour) $(160 $530 50 320) Thus labor productivity To tal revenue generated in a period_ $4,000 labor cost in that period 25 $160 ii) the multifactor productivity $4,000 Total revenue generated in a period 7.55 $530 cost of production in that period