Currently, at XYZ Corp. 3 workers working 29 hours (each) per week can produce 1,453 units per week. If labor productivity (units per hour) is to be increased by 8 percent, by how much will weekly per-worker hours have to be reduced?
Expert Answer
LABOUR PRODUCTIVITY=OUTPUT/ LABOUR HRS
OUTPUT = 1453 UNITS
LABOUR HRS = 3*29=87 HRS
LABOUR PRODUCTIVITY=1453/87=16.7
when productivity is increased by 8%
i.e. New Productivity = 16.7 + 8% of 16.7
=18.037
let the new labour hours x
=> 18.03= 1453 /x
=> x =80.55
difference = 87-80.55=6.444
therefore 6.44/3 =2.148 per worker hours have to be reduced.
or if we round off i.e 81 hrs
difference 87-81 =
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