Figure 3-9 Hereford Company Is Planning to Introduce a New

Figure 3-9 Hereford Company is planning to introduce a new product with an 80 percent learning rate for production for batches of 1,000 units. The variable labor costs are $30 per unit for the first 1,000-unit batch. Each batch requires 100 hours. There are $10,000 in fixed costs not subject to learning.
Refer to Figure 3-9. What is the cumulative average time per batch using the incremental unit-time learning curve for 2,000 units?

A) 180
B) 100
C) 90
D) 80

Correct Answer:

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