Question: Jack likes to evaluate two technology options based on their productivity. Option 1 requires 2 operators working for an 8 hours day and the material
Jack likes to evaluate two technology options based on their productivity. Option 1 requires 2 operators working for an 8 hours day and the material cost is $500. Option 2 requires only 1 operator working for an 8 hours day. The material cost is 300 but there is a utility cost of $400. The labor cost is $15 per hour for Option 1 and $20 per hour for Option 2. Both options generate 16 units of output per day.
True or False. The labor productivity for Option 1 and Option 2 is 1 and 2 with respectively.
True or False. Option 2 is more productive in terms of Multiple Factor Productivity.
It is possible some of the factors could be input and output at the same time.
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