Question: Lazer Technologies Inc. ( LTI ) has produced a total of 2 0 high - power laser systems that could be used to destroy any
Lazer Technologies Inc. LTI has produced a total of highpower laser systems that
could be used to destroy any approaching enemy missiles or aircraft. The units have
been produced, funded in part as private research within the research and development
arm of LTI, but the bulk of the funding came from a contract with the US Department of
Defense DoD
Testing of the laser units has shown that they are effective defense weapons, and if rede
signed to add portability and easier field maintenance, the units could be truckmounted.
The DoD has asked LTI to submit a bid for units.
The units that LTI has built so far cost the following amounts and are listed in the
order in which they were produced.
a Based on past experience, what is the learning rate?
b What bid should LTI submit for the total order of units, assuming that learning
continues?
c What is the cost expected to be for the last unit under the learning rate you estimated?
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