Question

b) Assume that a certain process has an 95% learning curve effect and the first unit took 4000hrs to produce.
Required:
i) Compute the number of hours required to produce the first 34 units                                                   (3 Marks)
ii) Compute the number of hours required to produce 34th unit.                                                (2 Marks)
iii) Assume that the wage rate is Kshs.100 per hour, compute the Labor cost of producing the last 16 units

Answer 1

Time taken to produce est unit (a) = 4000 houry learning rate = 95%. . Learning cofficient (6) = logo = – 0.074 logo.05 (1) hours orearuised produce 34 units to yrab y = average time per unit xe Number of units produced b= learning coefficient a ² time to produce ist unit de -0.074 y=4000 x 34 logy = 109 4000 - 0.074 10g 34 = 3.602 -0.074 (10531) - 3.602 -0.113 = 3.489 y= antilog 3.489 3083 hours per unit es Total hours reauired to produce 34 units = 34 units X 3083 hours perunit F3y = 104 822 houry 7

in hours required to produce 34th unit step: hours reanived 33 unit 9. Ob -0.074 4000x33 y = logy: 1094000 -0.074 (tog33) - 3,6020- 0.074 (1-5185) 53.6020- 0.1124 y = anti log 339 3.4896 = 3089 hours per unit Total time (33 units) = 33 units x 3089.. 733 = 101937 hours = Time searuired to produce 34th unit - T 34 - T33 = 104822 - 101937. = 2885 hours

laste producing 16 unik. of (1) Labour cost last 16unit to produce Total time reauired reanived ime Total time - Total time for 34 unila - for sunits Total time reanived for sunits y. Ob y= 0.074 uooo CIB) 10g 4000 - 0.077 4 (10918) logy = 3-6020 - 0.Day (1.2553) 2 3.6090 - 0.0929 = 3+5091 (718) y= antilog 3.509) 3229 hours per omil .:: Total time for Igunit = 1643229 - 51604 hours time rearuired for last 16 unit = T3y - T18 = 104822 - 51664 hours - house = 53158 hous Labour Cost = 5315 8 house x Kshs 100 per hour - 5315800/—