Question

If 200 labor hours were required to produce the first unit in a production run and 80 labor hours were required to produce the 6 unit, what was the learning curve rate during production?

Answer 1

Step 1

Concept of learning curve

Learning curve graphically depicts the relation between the cost and output over a defined period of time. Basically, it represents the repetitive task of an employee or worker. A steeper slope means initial learning translates into higher cost savings and subsequent learnings caused increasingly slower, more difficult cost savings.

Formula for calculating learning curve

T_n=T₁n^b

where,

n=the unit number (like 1 for the first unit, 2 for the second unit, etc...)

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T₁=the amount of time to produce the first unit.

T_n=the amount of time to produce unit n

b= the learning curve factor, calculated as In(p)/ln(2), where In(x) is the natural logarithm of x.

p= the learning percentage

Step 2 Solution

TN= T Initial

Nb==> T(6)= T(1) 6b 80= 200 6b 0.400 = 6blog0.40=blog(6) b=log(0.40)/log(6)=-0.5113 is defined as log (learning curve rate)/ log20

b = [log(learning curve rate)/log 2.0]=-0.5113

log(learnig curve rate)=-1.3219

learning curve rate is =10(-1.3219)= 55%