2.1 Calculate the multi-factor productivity for the years 2014 to 2017 for the above. Answer: In the question Average Hourly Rate for worker is not given, however, it is required for the purpose of calculating multifactor productivity, thus, I have considered a fixed value of Average Hourly Rate over the years 2014 to 2017, again, you can change the value of Average Hourly rate and keep the appropriate value for Average Hourly Rate, further using the Formula, we can Calculate Multi- factor Productivity, Formula is shown in the MS Excel Sheet, Year 2014 2015 2016 2017 Output 560500 678500 779050 1050225 Number of workers employed 25 30 46 55 Working hours per day 7. 5 7. 5 7. 5 9 Working days per annum 240 245 250 260 Material cost (R's) 125000 175000 250000 400000 Average Hourly Rate for Worker - Not Given in the Question, however considered for the sake of Calculation 10 10 10 10 MultiFactor Productivity Formula - Output/Input 0. 975 0. 934 0. 700 0. 623 1 B C D E F 2 Year 3 2014 2015 2016 2017 4 Output 560500 678500 779050 1050225 5 Number of workers employed 25 30 46 55 6 Working hours per day 7. 5 7. 5 7. 5 9 7 Working days per annum 240 245 250 260 8 Material cost (R's) 125000 175000 250000 400000 9 Average Hourly Rate for Worker - Not Given in the Question, however considered for the sake of Calculation 10 10 10 10 10 MultiFactor Productivity Formula - Output/Input =C4/((C8)+(C5*C6*C7*C9)) =D4/((D8)+(D5*D6*D7*D9)) =E4/((E8)+(E5*E6*E7*E9)) =F4/((F8)+(F5*F6*F7*F9)) 2. 2 Analyse the multifactor productivity and advise Fikile on the state of his operations. Based on Analyzing the Multi- Factor productivity and Based on Above calculation, it can be observed that Over the year 2014 to 2017, Multi-Factor productivity has reduced, or we can conclude that how much Multi-factor productivity of Year 2015 and other Years reduced with respect to that of Year 2014, as stated below: Year 2014 2015 2016 2017 Multi-Factor Productivity Reduced with Respect to Year 2014 = Formula =( Multi factor productivity for a given year - Multi factor productivity of Year 2014)/Multi factor productivity of Year 2014 4. 16% 28. 16% 36. 14% above data can depict us that the company Fikile focused on increasing the output and Output increased from year 2014 onward to Year 2017 and they have increased Inputs accordingly to increase the output, for example, they have increased Material cost over the 2014 to Year 2017, they have also increased Number of workers over the year 2014 to Year 2017, but Input cost not optimized or minimized to get higher Multi -factor Productivity, thus the company Fikile should be advised to optimize the Cost associated with Labor and Material to get higher value of Multi-factor productivity 2. 3 What should Fikile's Furnisher do to improve productivity? (10) Fikile's Furnishers should do following things to Improve the productivity, those are stated below: They should gain encouragement to bring more Innovative way, Creative way in the process of production, improve the technology, they should improve Transportation facility for their company, and build friendly infrastructure, thus more output can be produced with optimized Input cost they should look for a way to reduce labor cost or get more output with same Labor Cost, get efficient and specialized labor, who can confidently deliver better output, Negotiate with suppliers or look for competitive pricing for the material Input,