Answer :
Answer:
%age of multifactor productivity reduction = 8.33%
Step-by-step explanation:
Total cost for chemicals = $10
Total cost of labor = $40
Total cost of misc = $5
Total initial cost = 10+40+5 = $55
Increase in use of chemical = 50%
Increase in cost of chemical = 10+ (0.5)(10) =15
[Note (0.5)(10) is 50% of initial chemical cost]
Total increase in cost= $15+ $40 + $5 =%60
[tex]\%age\,\, of\,\, increase\,\, in \,\,cost =\frac{initial\,\, cost}{incresed\,\,cost}\times 100\%\\\\=\frac{55}{60}\times 100\%\\\\\\= 91.67\%[/tex]
%age of multifactor productivity reduction = 100 - 91.67 = 8.33%