Brown's, a local bakery, invested $5000 to upgrade the oven at the beginning of this...
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Brown's, a local bakery, invested $5000 to upgrade the oven at the beginning of this year. Thus, the cost of capital increased from $15,000 to $20,000. The oven manufacture told Brown's that the upgrade would make the oven 25% more efficient (increase marginal factor productivity). Use the data below to verify the manufacture's claim and calculate individual input productivities. Assume the cost of labor is $30 per hour. Use this information and the information in the table to answer the quiz questions. Last This Year year Production (dozen 1,650 loaves per unit) 2,100 Labor hours 550 350 What is the change in labor productivity due to the increase in capital spending? O 25% 0 75% 100% O 50% Question 4 1 pt What is the Marginal Factor Productivity due to the new capital investment? Round to two decimal places. Due to rounding error select the answer closest to your estimate. O 0.105 O 0.069 0.042 O 0.20
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