Refer to the data for Exercise 13-37.

Assume the fabric costs S4 per metre in 2019 and $4.10 per metre in 2018.

Required
1. Compute Guble Company's total factor productivity (TFP) for 2019.

2. Compare TFP for 2019 with a benchmark TFP for 2018 inputs based on 2019 output.

3. What additional information does TFP provide that partial productivity measures do not?

Data from Exercise 13-7

Guble Company manufactures wallets from fabric. In 2018, Guble made 2,500,000 wallets using 1,875,000 metres of fabric. In 2019, Guble plans to make 2,650,000 wallets and wants to make fabric use more efficient At the same time, Guble wants to reduce capacity; capacity in 2018 was 3,000,000 wallets at a total cost of $9,000,000. Guble wants to reduce capacity to 2,800,000 wallets, at a total cost of $8,680,000 in 2019. Suppose that in 2019 Guble makes 2,650,000 wallets, uses 1,669,500 metres of fabric, and reduces capacity to 2,800,000 units and costs to $8,680,000.