1. The three person crew worked their way through the neighborhood, mowing lawns,
edging, apply fertilizer and weed treatments where necessary and collecting all the
clippings for use as much as part of their new green initiative. Their pricing scheme
appears in Table A and the mix of orders and service costs appear in Table B.
Table A: Price List:
SERVICE
PRICE
LABOR(hrs) MATERIAL
Mow lawn
$70
1
$3
Edge
$25
.25
$2
Fertilizer treatment
$130
.25
$40
$80
5% discount
times the number
of services
.25
$25
Weed prevention treatment
Multiple services
Workers are paid at a rate of $10 per hour, and overhead is charged at 120% (or 1.2
times) labor costs. For example, for a customer that gets both mowing and edging, their
$95 bill would be discounted for two services times 5% for a total of 10% off the $95
straight charge for a cost of $85.50. A customer receiving three services would get a 15%
discount off their service bill.
Table B: Orders Processed
SERVICE
# Customers
Mow lawn & edge
6
Mow lawn, Edge, and fertilize
3
Mow lawn, Edge, and weed prevention treatment
2
Mow lawn & fertilize
2
a) Calculate the multifactor productivity for each service combination to determine
the one that is most productive from a multifactor perspective.
b) Calculate the overall labor productivity.
