Question

Kelly-Lambing, Inc., a builder of government contracted small ships, has a steady workforce of 10 very skilled craftspeople. These workers can supply 2,500 labor-hours each per year. Kelly-Lambing is about to undertake a new contract, building a new style of boat. The first boat is expected to take 6,200 hours to complete. The firm thinks that 75% is the expected learning rate. What is the firm's "capacity" to make these boats-that is, how many units can the firm make in 1 year? If the operations manager can increase the learning rate to 70% instead of 75 %, how many units can the firm make? (Round all numerical responses in this exercise to the nearest whole number.)

Number of Boats @ Total time 75% and 70%

4

5

6

7

8

Answer 1

We have to take help of standard learning curve table to arrive at required answer .

Total available labour hours from 10 workers in 1 year = 2500 labour – hours/ worker x 10 = 25,000 labour-hours

Time required to complete first boat =6200 hours

Learning rate = 75%

Basis incorporating above data in learning curve table:

Total time required to produce 6 units = 24394 hours

Total time required to produce 7 units = 27158 hours

Therefore , maximum 6 number of boats can be made in 1 year when maximum available labour hours is 25000

Similarly ,

Time required to complete first boat =6200 hours

Learning rate = 70%

Basis incorporating above data in learning curve table:

Time required to produce 7^th unit = 24553 hours

Time required to produce 8^th unit = 26680 hours

Therefore maximum 7 number of boats can be made in 1 year when maximum available labour hours is 25000

MAXIMUM 6 NUMBER OF BOATS CAN BE MADE IN 1 YEARAT LEARNING RATE OF 75%

AMXIMUM 7 NUMBER OF BOATS CAN BE MADE IN 1 YEAR AT LARNING RATE OF 70%