Helena Company needs to increase its profits and so has embarked on a program to increase its overall productivity. After one year of operation, Kent Olson, manager of the Columbus plant, reported the following results for the base period and its most recent year of operations:   20x1 20x2 Output 184,500      217,000      Power (quantity used) 23,063      11,000      Materials (quantity used) 46,125      47,100      Suppose the following input prices are provided for each year:   20x1 20x2 Unit price (power) $ 6          $ 7          Unit price (materials) 20          19          Unit selling price 8          10          Required: 1. Compute the profit-linked productivity measure. By how much did profits increase due to productivity? If required, round your intermediate calculations and final answers to the nearest dollar amount. 2. Calculate the price-recovery component for 20x2. If required, round your intermediate calculations and final answers to the nearest dollar amount.

Essentials of Business Analytics (MindTap Course List)
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Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
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Helena Company needs to increase its profits and so has embarked on a program to increase its overall productivity. After one year of operation, Kent Olson, manager of the Columbus plant, reported the following results for the base period and its most recent year of operations:

  20x1 20x2
Output 184,500      217,000     
Power (quantity used) 23,063      11,000     
Materials (quantity used) 46,125      47,100     

Suppose the following input prices are provided for each year:

  20x1 20x2
Unit price (power) $ 6          $ 7         
Unit price (materials) 20          19         
Unit selling price 8          10         

Required:

1. Compute the profit-linked productivity measure. By how much did profits increase due to productivity? If required, round your intermediate calculations and final answers to the nearest dollar amount.

2. Calculate the price-recovery component for 20x2. If required, round your intermediate calculations and final answers to the nearest dollar amount.

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