Assume the same information for the Blue Seas Company as in Problem 10- 35 with one exception. This exception is that Blue Seas uses a 90% incremental unit- time learning model as a basis for predicting direct manufacturing labor- hours in its assembling operations. (A 90% learning curve means b = - 0.152004.)
In Problem 10- 35, The Blue Seas Company, which is under contract to the U. S. Navy, assembles troop deployment boats. As part of its research program, it completes the assembly of the first of a new model (PT109) of deployment boats. The Navy is impressed with the PT109. It requests that Blue Seas submit a proposal on the cost of producing another six PT109s. Blue Seas reports the following cost information for the first PT109 assembled and uses a 90% cumulative average-time learning model as a basis for forecasting direct manufacturing labor-hours for the next six PT109s. (A 90% learning curve means b = -0.152004.)

1. Prepare a prediction of the total costs for producing the six PT109s for the Navy.
2. If you solved requirement 1 of Problem 10- 35, compare your cost prediction there with the one you made here. Why are the predictions different? How should Blue Seas decide which model it shoulduse?

  • CreatedMay 14, 2014
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