Jericho Vehicles is considering making a bid for a mobilerocket-launching system for the U.S. military. However,the company has almost no experience in producing thistype of vehicle. In an effort to develop a learning curvefor the production of this new mobile weapon system, management has called contacts from several former competitors who went bankrupt. Although management couldnot obtain direct learning curve rates, they did learn fromone contact that for a system with similar features, the firstunit required 2400 hours of direct labor to produce and the30th and final unit required 1450 hours to produce. Determine the learning curve rate for this vehicle.

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
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Jericho Vehicles is considering making a bid for a mobile
rocket-launching system for the U.S. military. However,
the company has almost no experience in producing this
type of vehicle. In an effort to develop a learning curve
for the production of this new mobile weapon system, management has called contacts from several former competitors who went bankrupt. Although management could
not obtain direct learning curve rates, they did learn from
one contact that for a system with similar features, the first
unit required 2400 hours of direct labor to produce and the
30th and final unit required 1450 hours to produce. Determine the learning curve rate for this vehicle.

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