A bakery produces 10,000 loaves of bread each week. The cost of its existing baking machine is $8,000 and will remain productive for 4 years. The labour cost per year is $20,000. Assume there are 52 weeks in a year. Calculate the productivity measure of "units of output per dollar of input" averaged over the four-year period. (4 marks)

As the bakery manager, you are deciding whether to purchase a higher-end baking machine that costs $15,000, with an operating life of 5 years. It would reduce labour costs to $10,000 per year. Relate how you can apply productivity concept to decide whether you should consider purchasing this machine. Show the calculations.