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Arte-miy333 [17]
2 years ago
6

Jack Simpson, contract negotiator for Nebula Airframe Company, is currently involved in bidding on a follow-up government contra

ct. In gathering cost data from the first three units, which Nebula produced under a research and development contract, he found that the first unit took 2,000 labor hours, the second took 1,200 labor hours, and the third took 1,130 hours.
In a contract for three more units, how many labor hours should Simpson plan for?
Business
1 answer:
Schach [20]2 years ago
4 0

Answer:

3,825.2 labor hours

Explanation:

Learning rate (Unit 1 and unit 2):

= Labor hour required for 2nd unit ÷ Labor hour required for 1st unit

= 1,200 ÷ 2,000

= 0.60

Learning rate (Unit 2 and unit 3):

= Labor hour required for 3rd unit ÷ Labor hour required for 2nd unit

= 1,130 ÷ 1,200

= 0.94

Average of learning rates = (0.60 + 0.94 ) ÷ 2

                                           = 0.77

As per learning curve calculator the value of 77% for 6 units = 4.0776

Cumulative time = Factor × Time of first unit

                           = 4.0776 × 2,000

                           = 8,155.2

Hence,

Time for next three units:

= Cumulative time - Sum of the time of first, second and third unit

= 8,155.2 - (2,000 + 1,200 + 1,130)

= 3,825.2 labor hours should Simpson plan for.

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