Question 1) A milk factory seeks advice from an external consulting company concerning its business and production processes. The final consulting report describes several steps to increase productivity including the implementation of cutting-edge processing techniques through more powerful filtering systems

Existing System Workers 12, Milk Output/hour 1,000 gallons Wage Rate/hour $12 Filtration Cost/hour $170 Price per gallon $2.40

Proposed System Workers 9 Milk Output/hour 1,400 gallons Wage Rate/hour $12 Filtration Cost/hour $120 Price per gallon $2.40

a) What is the multifactor productivity for the existing system? (7 pts)

b) What is the multifactor productivity for the proposed system? (7 pts)

c) What increase in productivity is associated with the proposed system? (6 pts)