Management is questioning proposals by the HR department to increase spending on training. You know that well-trained employees are more productive, but how do you quantify that? In this assignment, you will compare the cost of training with the savings from productivity improvements because of training. By calculating the return on investment (ROI), you will gain a better understanding of the value of allocating budget resources to training.

Each of the following pieces of information is for the questions below:

- The company spends $32,000 per year in wages for each Level 1 employee

- You currently employ 500 Level 1 workers.

- The current productivity level is 800 units per worker

- The current production goal of 400,000 units

- By spending $240,000 on training, it is projected that productivity can be increased 2%

ROI Formula: ROI = 100 (Savings Expense) / Expense

1. What is the new productivity level if it increases 2% over the current level of 800 units per worker? Enter the new productivity level below.

2. How many employees would be required to meet a changed production goal of 425,000 units at the new level of productivity calculated in Question 01? Your company does not employ people part-time; be conservative and round up.

3. If yearly production remains at 400,000 units, what is the yearly savings from the reduced number of Level 1 employees because of the increased productivity level calculated in Question 01? Your company does not employ people part-time; be conservative and round up

4. Drawing on the numbers from the Basic Information section above, use the ROI formula to calculate the return on investment from the training expense. Your company does not employ people part-time; be conservative and round up.

5. Is the investment in training worthwhile? Use the ROI to justify your response.