Mcq 4 Wanted to ask if learning rate has changed from 90 to 95% this means that we are working faster now so it will take less hours to produce the unit which means less costs The answer is c I understand that target cost will remain same but how will cost gap increase? It should decrease as our cost of direct labour has decreased
An increase in the learning rate does not mean that they are working faster (and I do explain this in my free lectures). (A learning rate of 100% means there is no learning at all and they would never get faster!)