Question: Don Carlisle is the president of Carlisle Manufacturing, a producer of RV tires. Carlisle makes 1000 tires per day with the following resources:

Labor: 400 hours per day @ $12.50 per hour

Materials: 20,000 lbs. per day @ $1.50 per lb.

Energy: 10,000 kwh per day @ $.50 per kwh

a) Find the productivity for each resource.

b) Find the multifactor productivity for these tires at Carlisle Mfg.

c) What is the percentage change in the multifactor productivity for next year if the cost of labor goes to $13.00 per hour, material costs go up to $1.65 per lb., and the cost of energy drops to $.47 per kwh? Assume that resource usage remains constant but output goes up to 1050 tires per day.