If the units produced by a factory decreased by 10% and the labor productivity decreased by 25%,then the labor hours __________.
A)decreased by 15%
B)increased by 15%
C)increased by 17%
D)increased by 20%

Question

Quizplus · Accepted Answer

If units produced decreased by 10% and labor productivity decreased by 25%, then labor hours must have increased to compensate for the reduced productivity. The formula for labor hours is: Labor Hours = Units Produced / Labor Productivity. If units produced are 90% of the original and productivity is 75% of the original, labor hours increase by (1/0.75) / (0.9) = 1.2, which is a 20% increase.

If the Units Produced by a Factory Decreased by 10