A retail store had sales of $45,550 in April and $54,250 in May. The store emplo

Question

A retail store had sales of $45,550 in April and $54,250 in May. The store employs eight full-time workers who work a 40-hour week. In April the store also had eight part-time workers at 14 hours per week, and in May the store had ten part-timers at 19 hours per week (assume four weeks in each month). Using sales dollars as the measure of output, what is the percentage change in productivity (dollars output per labor hour) from April to May? (Round your intermediate calculations and final answer to 2 decimal places.)

Explanation / Answer

Productivity = Output/Input

April:

Output ($) = $45,550

Input (Hours) = ((40hour per week*8 hours per day) + (8part time workers *14 hours per week ))*4weeks per month

= (320 + 112) * 4

= 1728 hours

Prodctivity =  $45,550/1728 hours = 26.36

May:

Output ($) = $54,250

Input (Hours) = ((40hour per week*8hours per day) + (10part time workers *19hours per week ))*4weeks per month

= (320 + 190) * 4

= 2040 hours

Prodctivity =  $54,250/2040 hours = 26.59

Percentage change = (26.59- 26.36)/26.36 = 0.0087 = 0.87%

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