Question

The Emerson Corporation, a manufacturer of airplane landing gear equipment, is trying to develop a learning curve model to help forecast labor costs for successive units of one of its products. From past data, the firm knows that labor costs of the 25th, 75th, and 125th units were $700, $500, and $400, respectively. Using the learning curve equation for these labor costs,

log10C=3.32596−0.34112×log10Qlog10C=3.32596−0.34112×log10Q

What is the estimated cost of the 200th unit of output?

$357

$348

$367

The model estimates that the labor cost for the 50th unit is $557.71. What is the approximate percentage of learning at Emerson?

96%

64%

80%

Answer 1

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