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An operation has a 20 percent scrap rate. As a result, 80 pieces per hour are produced. What is the potential labor productivity that could be achieved by eliminating the scrap?

1 Answer

6 votes

Answer:

25%

Step-by-step explanation:

If there is 20% scrap, then

80% of (production + scrap) = 72 pcs/hr

Now,


(80)/(100) * (72+scrap)= 72 pcs/hr\\0.80* (72+Scrap) = 72 \\ 72+Scrap = (72)/(0.80)\\72 + Scrap = 90\\Scrap = 18 pcs /hr

The percent increase in labor productivity is,
(18)/(72) =0.25.

Or it can be written as 25% of which would give 80 pieces per hour.

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