51. CSO: 1B3b LOS: 1B3e
  Aerosub Inc. has developed a new product for spacecraft that includes the manufacturing of a complex part. The manufacturing of this part requires a high degree of technical skill. Management believes there is a good opportunity for its technical force to learn and improve as they become accustomed to the production process. The production of the first unit requires 10,000 direct labor hours. If an 80% learning curve is used and eight units are produced, the cumulative average direct labor hours required per unit of the product will be
  a. 5,120 hours.
  b. 6,400 hours.
  c. 8,000 hours.
  d. 10,000 hours.
  52. CSO: 1B3b LOS: 1B3d
  A manufacturing firm plans to bid on a special order of 80 units that will be manufactured in lots of 10 units each. The production manager estimates that the direct labor hours per unit will decline by a constant percentage each time the cumulative quantity of units produced doubles. The quantitative technique used to capture this phenomenon and estimate the direct labor hours required for the special order is
  a. cost-profit-volume analysis.
  b. the Markov process.
  c. linear programming analysis.
  d. learning curve analysis.
  53. CSO: 1B3b LOS: 1B3e
  A manufacturing company has the opportunity to submit a bid for 20 units of a product on which it has already produced two 10-unit lots. The production manager believes that the learning experience observed on the first two lots will continue for at least the next two lots. The direct labor required on the first two lots was as follows.
  · 5,000 direct labor hours for the first lot of 10 units
  · 3,000 additional direct labor hours for the second lot of 10 units
  The learning rate experienced by the company on the first two lots of this product is
  a. 40.0%.
  b. 60.0%.
  c. 62.5%.
  d. 80.0%.
  54. CSO: 1B3b LOS: 1B3e
  Aerosub Inc. has developed a new product for spacecraft that includes the manufacture of a complex part. The manufacturing of this part requires a high degree of technical skill. Management believes there is a good opportunity for its technical force to learn and improve as they become accustomed to the production process. The production of the first unit requires 10,000 direct labor hours. If an 80% learning curve is used, the cumulative direct labor hours required for producing a total of eight units would be
  a. 29,520 hours.
  b. 40,960 hours.
  c. 64,000 hours.
  d. 80,000 hours.
  55. CSO: 1B3b LOS: 1B3e1B3b
  Propeller Inc. plans to manufacture a newly designed high-technology propeller for airplanes. Propeller forecasts that as workers gain experience, they will need less time to complete the job. Based on prior experience, Propeller estimates a 70% cumulative learning curve and has projected the following costs.
  If Propeller manufactures eight propellers, the total manufacturing cost would be
  a. $50,660.
  b. $54,880.
  c. $62,643.
  d. $112,000.