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Long Beach Bank employs three loan officers, each working eight hours per day. Each officer processes an average of five loans per day. The bank’s payroll cost for the officers is $920 per day and there is a daily overhead expense of $500. The bank has just purchased new computer software that should enable each bank officer to process eight loans per day, although the overhead expense will increase to $575.
a) What is the labor productivity in labor hours?
b) What is the multifactor productivity before and after implementation of the new software?
c) What is the percentage change in multifactor productivity?
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