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Time for first batch of 50 units is 400 hours but labor budget is the subject of learning rate and it is 90%. Rate of pay for labour is $12 per hour. Business had received and satisfied an order of 600 units but it has nle received a second order for another 800 units. value of b is -0.152 . What is the cost of second order ?
Time for first order is 400*50raised to 0.-152 =220.7 hours.
I dont understand what to do then . Please help
You must have an answer in the same book in which you found the question, and so you should ask about whatever part of the answer you do not understand! (If you do not have an answer then you are wasting your time – you should be using a Revision Kit from one of the ACCA approved publishers.)
The time for the first order is not what you have written at all!
The first order was for 600 units which is 600/50 = 12 batches.
Therefore the average time per batch is 400 x 12^(-0.152), and the total time is 12 times the average time.The second order is for another 800/50 = 16 batches, which bring the total up to 28 batches.
So you need to calculate the total time for 28 batches and then subtract the total time for 12 batches.
Have you actually watched my free lectures on learning curves?
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