A company produces 300 bicycles every day.Each bicycle is worth $250.The inputs used to make those bicycles are labor, materials, and machine costs.The company pays their employees a total of $10,000 per day, the materials to make each bicycle cost $50, and the cost to operate the machines is $3000 per day.Based only on the data provided, what is this company's total productivity for one day?

Question

Quizplus · Accepted Answer

The company produces 300 bicycles per day, each worth $250. So, the total value of the output is 300 * $250 = $75,000. The total cost of inputs is $10,000 (labor) + 300 * $50 (materials) + $3000 (machines) = $23,000. Therefore, the total productivity is $75,000 / $23,000 = 2.68.

A Company Produces 300 Bicycles Every Day