Reference no: EM131800613

Qusetion: Student tuition at Boehring University is $150 per semester credit hour. The state supplements school revenue by $90 per semester credit hour. Average class size for a typical 3 credit course is 45 students. Labor costs are $4400 per class, materials costs are $23 per student per class, and overhead costs are $27000 per class. The multifactor productivity ratio currently is 1.00 and the labor productivity ratio is $144.64 per hour if the instructors work on an average of 14 hours per week for 16 weeks for each 3-credit class of 45 students.

Coach Bjourn Toulouse led the Big Red Herrings to several disappointing football seasons. Only better recruiting will return the Big Red Herrings to winning form. Because of the current state of the? program, Boehring University fans are unlikely to support increases in the $192 season ticket price. Improved recruitment will increase overhead costs to $31,000 per class section from the current $27,000 per class section. The? university's budget plan is to cover recruitment costs by increasing the average class size to 70 students. Labor costs will increase to $6300 per 3 credit course. Material costs will be about $25 per student for each 3 credit course. Tuition will be $200 per semester? credit, which is supplemented by state support of ?$90 per semester credit.

a) The multifactor productivity ratio with the university's plan to meet the expenses related to improving recruitment is what?

As compared to the present multifactor productivity ratio, the university's plan will result in (an improved or a reduced) multifactor productivity ratio.

b) If instructors are going to work an average of 20 hours per week for 16weeks for each 3-credit class of 70 students, the labor productivity ratio is $___ per hour.