A. The learning curve is calculated as the percentage of reduction in costs that occurs when production is doubled. In looking at the information provided, we see that the materials costs do not have any efficiencies as production increases. For all levels of production the materials cost is $6,000 per unit. So, our attention is focused on the labor. In order to produce 10 units, the company incurred $120,000 of labor. If that same productivity level were to continue (i.e., if no learning were taking place), in order to produce 20 units, they would incur $240,000 of labor costs. However, they incurred only $192,000 of labor costs, which is 80% of $240,000. And at 20 units at a cost of $192,000, if no learning were taking place, it would have cost $384,000 to produce a total of 40 units, including the first 20. However, it cost only $307,200, which is 80% of $384,000. So, every time production doubles, the company is experiencing a learning curve of 80%.

B. This answer is incorrect. See the correct answer for a complete explanation.

C. This answer is incorrect. See the correct answer for a complete explanation.

D. This answer is incorrect. See the correct answer for a complete explanation.