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The Populus Tremula Plant has just implemented a process improvement, which resulted 20% increase in output with less material, but it requires three additional workers.
The Populus Tremula Plant has just implemented a process improvement, which resulted 20% increase in output with less material, but it requires three additional workers. Under the old process, seven workers could produce 60 units per hour. Labor costs are $30/hour. Material input was previously $25/unit and is $20/unit for the new process. Overhead is estimated to be 1.2 times direct labor cost. Finished products sell for $45 each. Calculate the increase in productivity associated with the process improvement
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