Solution:

Week 1:

Output = 30000 units

Labor cost: 6 x $12 x 40 = $2880

Overhead Cost = 1.5 x $2880 = $4320

Material cost =450 lbs x $6 = $2700

Multifactor productivity: Output/Input = 30000 units/(2880 + 4320 +2700) = 30000 units/$9900

= 3.03 units/$ cost

Week 2:

Output = 33600 units

Labor cost: 7 x $12 x 40 = $3360

Overhead Cost = 1.5 x $3360 = $5040

Material cost =470 lbs x $6 = $2820

Multifactor productivity: Output/Input = 33600 units/(3360 + 5040 +2820) = 33600 units/$11220

= 2.99 units/$ cost

Week 3

Output = 32200 units

Labor cost: 7 x $12 x 40 = $3360

Overhead Cost = 1.5 x $3360 = $5040

Material cost =460 lbs x $6 = $2760

Multifactor productivity: Output/Input = 32200 units/(3360 + 5040 +2760) = 32200 units/$11160

= 2.89 units/$ cost

Week 4

Output = 35400 units

Labor cost: 8 x $12 x 40 = $3840

Overhead Cost = 1.5 x $3840 = $5760

Material cost =480 lbs x $6 = $2880

Multifactor productivity: Output/Input = 35400 units/(3840 + 5760 +2880) = 35400 units/$12480

= 2.84 units/$ cost

Since multifactor productivity deceases with weeks so it is suggest to say that the effectiveness and
performance of the functional unit decreases gradually.

Output per week = 3000 x 0.04 x $70 x 3 = $25200

Labor cost = 3 x 25 x 40 = $3000

Mat.cost = $1000/week

OH cost = $9000/week

Multifactor productivity = 25200/(3000 + 1000+ 9000) = 25200/13000 = 1.94