A company offers ID theft protection using leads obtained from client banks. Thr

Question

A company offers ID theft protection using leads obtained from client banks. Three employees work 40 hours a week on the leads, at a pay rate of $30 per hour per employee. Each employee identifies an average of 2,800 potential leads a week from a list of 4,900. An average of 7 percent of potential leads actually sign up for the service, paying a one-time fee of $75. Material costs are $1,400 per week, and overhead costs are $10,000 per week.

Calculate the multifactor productivity for this operation in fees generated per dollar of input. (Round your answer to 2 decimal places.)

A company offers ID theft protection using leads obtained from client banks. Three employees work 40 hours a week on the leads, at a pay rate of $30 per hour per employee. Each employee identifies an average of 2,800 potential leads a week from a list of 4,900. An average of 7 percent of potential leads actually sign up for the service, paying a one-time fee of $75. Material costs are $1,400 per week, and overhead costs are $10,000 per week.

Explanation / Answer

2,800*3*$75*0.07 = 44,100

3*40*30 +1,400 +10,000 = 15,000

Multifactor productivity = 44,100/15,000 = 2.94

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