SUPPLEMENTDlLearningCurveAnalysis

SUPPLEMENT D: LEARNING CURVE ANALYSIS

TRUE/FALSE
1.

A line called a learning curve can represent the learning effect.

True (The Learning Effect, easy)

2.

The first learning curve was developed by the aircraft industry.

True (The Learning Effect, moderate)

3.

One use of learning curves is for financial planning.

True (Using Learning Curves, moderate)

MULTIPLE CHOICE
4.

Which of the following statements about learning curves is generally TRUE?

a. Management can decide to achieve a certain rate of learning.
b. Learning curves were first quantified by the U.S. Postal Service.
c. Using the "doubling" model, a learning curve with a rate of learning of 70 %, means the 10th
unit takes 70 % of the time that the 20th unit will take.
d. Learning curves are a recognition of the concept that the time a task takes usually decreases
with experience.
d (The Learning Effect, moderate)

5.

Which one of the following statements about learning curves is TRUE?

a. A learning curve assumes that the direct labor requirements per unit will decrease at an
increasing rate as cumulative production increases.
b. Learning at a capital-intensive operation usually will be less than it is for a labor-intensive
operation.
c. Learning for a simple product will usually be greater than it is for complex products.
d. Learning curves can be used only for individuals, not for the whole organization.
b (Multiple sections, moderate)

6.

Which one of the following statements is TRUE about the relationship between learning curves and
competitive strategy?
a. Knowing where your process is on the learning curve will enable you to make frequent product
modifications.
b. Firms that emphasize low cost in their competitive strategy strive to move down the learning
curve by increasing volume.
c. Learning curves enable managers to project fixed manufacturing costs for future production
quantities.
d. Projecting the impact of learning curves into the future is one effective way of reducing the
impact of environmental uncertainty.
b (Multiple sections, moderate)

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7.

Which one of the following is an assumption of learning curves?

a. The cumulative time of production decreases as production increases.
b. Time reduction per unit increases as cumulative production increases.
c. The same learning curve should be used when a company increases its level of automation.
d. The reduction in time per unit follows an exponential curve.
d (Multiple sections, moderate)

8.

Which one of the following statements is NOT a typical assumption related to developing learning
curves?
a. The total direct labor hours needed to produce the first 100 units will be double the amount of
hours needed to build the first 50 units.
b. The direct labor needed per unit will decrease at a declining rate as cumulative production
increases.
c. The direct labor hours per unit will decrease according to an exponential curve as cumulative
production increases.
d. The direct labor needed to produce the 50th unit will always be more than the direct labor
needed to produce the 51st unit.
a (Developing Learning Curves, moderate)

9.

Under learning curve theory, with a learning rate of 70 %, the

a. time to produce the second unit will be 70 % less than the time to produce the first unit.
b. time to produce the second unit will be 30 % less than the time to produce the first unit.
c. cumulative average time per unit after producing the first 100 units will be 70 % less than the
average time per unit of the first 50 units.
d. average time per unit will be cut in half for every 70 units.
b (Developing Learning Curves, moderate)

10.

Which one of the following statements about learning curves is FALSE?

a. The direct labor for the n+1st unit will always be less than the direct labor required for the nth
unit.
b. The reduction in time will follow an exponential curve.
c. A benefit of learning curves is that they are unaffected by factors such as product complexity
and the rate of capital additions.
d. The cumulative average number of direct labor hours per unit for a given product after the 10th
unit with an 80 % learning rate will be less than that for the same product with a 70 % learning
rate.
c (Developing Learning Curves, moderate)

11.

Given that the first unit of a product took 282 hours to build and the learning rate is expected to be
80 %, how much time will it take to build the 40th unit?
a. Less than or equal to 79
b. Greater than 79 but less than or equal to 83
c. Greater than 83 but less than or equal to 87
d. Greater than 87
c (Developing Learning Curves, moderate)

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12.

Kodiak has just begun production of a new government contract for 1000 infrared cameras. The
first camera took 500 hours to produce. If the rate of learning is 83%, how much time should the
150th camera take to produce?
a. Less than or equal to 100 hours
b. Greater than 100 hours but less than or equal to 125 hours
c. Greater than 125 hours but less than or equal to 150 hours
d. Greater than 150 hours
c (Developing Learning Curves, moderate)

13.

Kodiak has just begun production of a new government contract for 1000 infrared cameras. The
first camera took 500 hours to produce. Suppose that Kodiak decides to use a learning rate of 80
%. This learning rate is typical for projects similar to the infrared camera assembly. The production
manager wants to know the total time it will take to assemble the 21st through the 40th units,
inclusive. A copy of Table D.1 is appended to this exam.
a. Less than or equal to 3000 hours
b. Greater than 3000 hours but less than or equal to 4000 hours
c. Greater than 4000 hours but less than or equal to 5000 hours
d. Greater than 5000 hours
b (Developing Learning Curves, moderate)

14.

Using the logarithmic approach to learning curves, determine the time required to produce the
100th unit. The learning rate is estimated to be 80 % and the first unit's requirement was 50 hours.
a. Less than or equal to 20 hours
b. Greater than 20 hours but less than or equal to 30 hours
c. Greater than 30 hours but less than or equal to 40 hours
d. Greater than 40 hours
a (Developing Learning Curves, moderate)

15.

The estimated time for producing the first unit of an order is 5 hours. If an 80 % learning rate is
applicable to this order, what is the estimated total time to produce the 11th through 20th units? A
copy of Table D.1 is appended to this exam.
a. Less than or equal to 15 hour
b. Greater than 15 hours but less than or equal to 25 hours
c. Greater than 25 hours but less than or equal to 35 hours
d. Greater than 35 hours
b (Developing Learning Curves, moderate)

16.

Suppose the average time for the first 1000 units you have manufactured is 2.375 minutes. Your
rate of learning is 90 %, and you need to find the total time required to manufacture the next 1000
units. A copy of Table D.1 is appended to this exam. A copy of Table D.1 is appended to this exam.
The total time is
a. not more than 2000 minutes.
b. greater than 2000 minutes but not more than 2700 minutes.
c. greater than 2700 minutes but not more than 3300 minutes.
d. greater than 3300 minutes.
a (Developing Learning Curves, difficult)

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17.

Given that the 3rd unit took 100 minutes and the rate of learning is 80 %, how much time will it
take to build the 96th unit?
a. Less than or equal to 30 minutes
b. Greater than 30 minutes but less than or equal to 35 minutes
c. Greater than 35 minutes but less than or equal to 40 minutes
d. Greater than 40 minutes
b (Developing Learning Curves, difficult)

18.

It took 100 hours to produce the first unit and 95 hours to produce the second unit. How many
hours are required to produce the eighth unit?
a. Less than or equal to 60 hours
b. Greater than 60 hours but less than or equal to 75 hours
c. Greater than 75 hours but less than or equal to 90 hours
d. Greater than 90 hours
c (Developing Learning Curves, moderate)

19.

It took 100 hours to produce the first unit and 70 hours to produce the fourth unit. What is the
learning rate for this operation?
a. Less than or equal to 80 %
b. Greater than 80 % but less than or equal to 83 %
c. Greater than 83 % but less than or equal to 86 %
d. Greater than 86 %
c (Developing Learning Curves, moderate)

20.

It took 100 hours to produce the first unit and the learning rate is 80 %. How much time will it take
to produce units 16 through 20? Table D.1 is appended to this exam.
a. Less than or equal to 160 hours
b. Greater than 160 but less than or equal to 170 hours
c. Greater than 170 but less than or equal to 180 hours
d. Greater than 180 hours
d (Developing Learning Curves, moderate)

21.

It took 120 hours to produce the first unit. If the learning rate is expected to be 85 %, how much
time will it take to produce the 30th unit?
a. Less than or equal to 38
b. Greater than 38 but less than or equal to 40
c. Greater than 40 but less than or equal to 42
d. Greater than 42
d (Developing Learning Curves, difficult)

22.

Given that the 5th unit took 10 hours to build and the learning rate is 90 %, how much time will it
take to build units 11 through 15? A copy of Table D.1 is appended to this exam.
a. Less than or equal to 38
b. Greater than 38 but less than or equal to 40
c. Greater than 40 but less than or equal to 42
d. Greater than 42
d (Developing Learning Curves, moderate)

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23.

XYZ Company has recently started production of a new product. It is known that it took only 40 %
as long to build the 20th unit as it took to build the 5th unit. What is the rate of learning for this
product?
a. Less than 40 %
b. Greater than or equal to 40 % but less than 60 %
c. Greater than or equal to 60 % but less than 80 %
d. Greater than 80 %
c (Developing Learning Curves, moderate)

24.

A company is introducing a new product. The first unit took 1000 hours to complete, and the fourth
unit took 750 hours to complete. What is the rate of learning for this product?
a. Less than 40 %
b. Greater than or equal to 40 % but less than 60 %
c. Greater than or equal to 60 % but less than 80 %
d. Greater than 80 %
d (Developing Learning Curves, moderate)

25.

The second unit of a new product took 50 hours to build. Assuming a learning rate of 80 %, how
long will it take to build the 30th unit?
a. Less than 15 hours
b. Greater than or equal to 15 hours but less than 19 hours
c. Greater than or equal to 19 hours but less than 23 hours
d. Greater than or equal to 23 hours
c (Developing Learning Curves, moderate)
Table SD.1
The production schedule for a new product follows:

The first unit took 100 hours to complete, and the rate of learning is 80 %. Each employee
works 40 hours per week, A copy of Table D.1 is appended to this exam.
26.

Using the information in Table SD.1, how much time will it take to produce the units in week 1?
a. Less than 800 hours
b. Greater than or equal to 800 hours but less than 1100 hours
c. Greater than or equal to 1100 hours but less than 1500 hours
d. Greater than 1500 hours
b (Using Learning Curves, moderate)

27.

Using the information in Table SD.1, what is the minimum number of employees needed in week
3?
a. Less than 20 employees
b. Greater than or equal to 20 employees but less than 30 employees
c. Greater than or equal to 30 employees but less than 40 employees
d. Greater than 40 employees
b (Using Learning Curves, moderate)
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28.

The production for a new product follows:

The first unit will take 1000 hours to produce and the learning rate is 90 %. If each employee
works 200 hours per month, estimate the number of full-time employees needed for month three. A
copy of Table D.1 is appended to this exam.
a. Less than or equal to 20
b. Greater than 20 but less than or equal to 25
c. Greater than 25 but less than or equal to 30
d. Greater than 30
b (Using Learning Curves, moderate)
29.

The production for a new product follows:

The first unit will take 2000 hours to produce and the learning rate is 90 %. Currently, the company
employs 40 workers, who each work 200 hours regular time per month. In which months will
overtime be needed for the above production schedule? A copy of Table D.1 is appended to this
exam.
a. Month 4 only
b. Months 3 and 4 only
c. Months 1 and 2 only
d. Month 1 only
b (Using Learning Curves, moderate)

FILL-IN-THE-BLANK
30.

The _____________ can be represented by a line called a learning curve.

learning effect (The Learning Effect, moderate)

31.

One assumption of learning curves is that the reduction in time will follow a(n) _________ curve.
exponential (Developing Learning Curves, moderate)

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SHORT ANSWERS
32.

What are the three major assumptions of the learning curve?

1. Direct labor required for the n+1st unit will always be less than that required for the nth
unit. 2. Direct labor requirements will decrease at a declining rate as cumulative production
increases. 3. Reductions in time will follow an exponential curve. (Developing Learning
Curves, moderate)

33.

How are learning curves useful in bid preparation?

Learning curves help estimate the cost of labor for bid preparation. (Using Learning
Curves, moderate)

34.

A manager of a company producing computer chips knows that in the early stages of production for
a new product the expenditures exceed receipts whereas in the latter stages the reverse is true. Give
an explanation for this phenomenon.
From the learning curve theory, the direct labor costs will exceed the average in the early
stages of production whereas the reverse is true in the latter stages. Pricing is often predicted
on average costs. (The Learning Effect, moderate)

35.

Why is the learning rate more pronounced for complex products than for simple products?
Complex products offer more opportunity for improving work methods, materials, and
processes. (Managerial Consideration in the use of Learning Curves, moderate)

PROBLEMS
36.

The estimated time to produce the first unit is 8 hours. If an 80% learning rate is applicable, what
is the estimated time to produce the first 20 units?
(Developing Learning Curves, moderate)
Learning rate

Time for first unit

Unit number
Time for unit 20
Cumulative average time per unit

80.0%

8
20
3.05
4.19

The time for the first 20 would be 4.19(20) = 83.8 hours.

37.

The estimated time to produce the first unit is 100 hours. If a 90% learning rate is applicable, what
is the estimated time of producing the 10th unit?
(Developing Learning Curves, moderate)
Learning rate

Time for first unit

Unit number
Time for unit 10
Cumulative average time per unit

90.0%

100
10
70.47
79.94

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