Question
Alyssas Custom Cakes currently sells 5 birthday, 2 wedding, and 3 specialty cakes each month for $50, $150, and $100 each, respectively. The cost of
Alyssas Custom Cakes currently sells 5 birthday, 2 wedding, and 3 specialty cakes each month for $50, $150, and $100 each, respectively. The cost of labor is $50 per hour including benefits. It takes 90 minutes to produce a birthday cake, 240 minutes to produce a wedding cake, and 60 minutes to produce a specialty cake. Alyssas current multifactor productivity ratio is 1.25.
Use the multifactor productivity ratio provided to calculate the average cost of the cakes produced. find the average cost of the cakes in aggregate, consolidating all of the cakes into one MFP factor
Calculate Alyssas labor productivity ratio in dollars per hour for each type of cake.
Based solely on the labor productivity ratio, which cake should Alyssa try to sell the most?
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