Part I: Effective cost per hour 1 shift (8 hours) per day 7 holidays 8 days of vacation Fringe: 40% of base wage Base hourly wage: $16.50 per hour 30-minute lunch (paid) plus two 15-minute breaks (paid) per day

1. What is the effective cost per hour per employee?

Part II: Reduction in labor cost Assume 350,000 hours of work needed every year Productivity increases from 75% to 85% Round number of workers to whole numbers (below .5, round down; .5 and above, round up)

2. What is the total dollar change in labor expense from the 10% increase in productivity?

3. What is the percent change in labor expense from this 10% increase in productivity? What does this change mean to the company?