Answer (A) is correct . The learning curve reflects the increased rate at which people perform tasks as they gain experience. The time required to perform a given task becomes progressively shorter. Ordinarily, the curve is expressed in a percentage of reduced time to complete a task for each doubling of cumulative production. One common assumption in a learning curve model is that the cumulative average time (and labor cost) per unit is reduced by a certain percentage each time production doubles. Thus, an 80% learning curve indicates that a doubling of production will reduce the cumulative average unit completion time by 20%. For example, if the first unit required 50 hours to complete, the average completion time after two units will be 40?hours (50 hours ¡Á 80%). If total production time is 80 hours (2?¡Á 40 cumulative average time), and the first unit required 50?hours, the time to produce the second unit must be 30 hours.Answer (B) is incorrect because This figure is based on the assumption that the time to produce the last unit (the incremental unit-time assumption) is reduced by 20%.
Answer (C) is incorrect because This figure is based on a 90% learning curve and the incremental unit-time assumption.
Answer (D) is incorrect because The completion time for the first unit is 50.0 hours.
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