Answer (B) is correct . With an 80% learning curve, the average cost after 8 units is 51.20% of the cost of the first unit (100% × 80% × 80% × 80%). After 16 units, the average cost is 40.96% (51.20% × 80%). Thus, the average cost of units in the last batch (units 9 through 16) must have been 30.72% [(40.96% × 2) – 51.20%].
Answer (A) is incorrect because This percentage is the average time required for the sixteenth unit.
Answer (C) is incorrect because This percentage is the time required for the eighth unit.
Answer (D) is incorrect because This percentage is the time required for the fourth unit.
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