Question

A textile factory in the United States pays 300 workers a total of $9 million each year to produce 4.5 million shirts. A foreign factory employs 225 workers at a total cost of $1,050,000 to produce 2,500,000 shirts. How do the labor costs per shirt of the American and foreign factory compare?

Answer 1

$2 and $0.42 per shirt.

Step-by-step explanation:

Given: US factory produce 4.5 million shirts.

Total cost of producing shirts is $9 million.

Foreign factory produce 2500000 shirts.

Total cost of producing shirts is $ 1050000.

As we know cost of producing 4.5 million shirts is $9 million

So, we will unitary method for finding cost of one shirt.

∴ Cost of 1 shirt produced =
`(9)/(4.5) = \$ 2\ per\ shirt`

∴Cost of producing 1 shirt by US´s textile factory is $2.

Similarly, as cost of producing 2500000 shirts by foreign factory is $1050000.

∴Cost of 1 shirt produced =
`(1050000)/(2500000) = \$ 0.42\ per\ shirt`

∴Cost of producing 1 shirt by foreign textile factory is $0.42.

The labour cost per shirt of America and foreign factory is
`\$ 2\ and\ \$ 0.42` respectively.