Question: (10 points) Q7) A self-employed artisan estimates the following unit production times for the first four units of a new product. Unit # Time to

(10 points) Q7) A self-employed artisan estimates

(10 points) Q7) A self-employed artisan estimates the following unit production times for the first four units of a new product. Unit # Time to make the unit (min) 1 400 360 338.4 4 324 (a)What is the learning rate for this product? (b) Suppose the artisan only uses some materials and her labor to make the product. Materials cost $250 per unit and she computes her labor cost at $100 per hour. She would make these products upon receiving an order and sets a price accordingly. What is the minimum price she would charge for the eighth customer, if she wants to break even? Justify your answer. (c) Suppose the artisan considers producing 8 units of the product and sell them all to a jewelry shop. The shop owner is willing to pay $6530.67 for all eight units in the order. Do you think the artisan breaks even? Justify your answer with analysis. 2 3

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