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Please help me with this question
The time for 1st batch of 50 units was 400 hours but the labour budget is the subject of a learning effect where the learning rate is 90%. The rate of pay for labour is $12 per hour.
The business had received and satisfied an order for 600 units but it has now received a second order for another 800 units. The value of b is -0.152
What will be the cost of this second order ?So far they have made 600/50 = 12 batches, and have now received another order for 800/50 = 16 batches. That will mean that they will have then made 28 batches in total.
So you need to calculate the total time to make 28 batches, and subtract the time to make 12 batches – they you will know the time for the second order.
I explain how to do this, in detail, in my free lectures on learning curves.
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