Problem 6-8 (Algo) Lambda Computer Products competed for and won a contract to produce two prototype units of a new type of computer that is based on laser optics rather than on electronic binary bits. The first unit produced by Lambda took 5,000 hours to produce and required $250,000 worth of material, equipment usage, and supplies. The second unit took 3,250 hours and used $187,500 worth of materials, equipment usage, and supplies. Labor is $20 per hour. Use Exhibit 6.5. a. Lambda was asked to present a bid for 10 additional units as soon as the second unit was completed. Production would start immediately. What would this bid be? Cost for 10 more units Exhibit 6.5 Improvement Curves: Table of Cumulative Values 60% 95% Unit 1 1.000 1.600 2 65% 1.000 1.650 2.155 2.578 85% 1.000 1.850 2.623 3.345 90% 1.000 1.900 2.746 3.556 1.000 1.950 2.872 3.774 3 2.045 4 2.405 5 2.710 2.946 4.031 4.662 6 3.274 4.688 4.339 5.101 5.845 5.538 6.404 7 3.572 5.322 2.977 3.216 3.432 3.630 8 3.847 4.102 Cumulative Improvement Factor 70% 75% 80% 1.000 1.000 1.000 1.700 1.750 1.800 2.268 2.384 2.502 2.758 2.946 3.142 3.195 3.459 3.738 3.593 3.934 4.299 3.960 4.380 4.834 4.303 4.802 5.346 4.626 5.204 5.839 4.931 5.589 6.315 5.501 6.315 7.227 6.026 6.994 8.092 6.514 7.635 8.920 6.972 8.245 9.716 7.407 8.828 10.48 7.819 9.388 11.23 8.213 9.928 11.95 8.404 10.19 12.31 6.574 7.290 7.261 8.111 9 5.936 6.533 7.116 8.244 10 3.813 4.144 4.341 4.780 7.994 9.374 12 8.955 10.62 12.27 14 4.438 5.177 9.331 10.72 12.04 16 4.704 5.541 10.38 13.91 18 4.946 11.41 20 5.879 6.195 6.492 12.40 13.33 14.61 15.86 22 13.38 5.171 5.379 5.574 5.668 15.52 17.13 18.72 20.31 21.10 24 25 6.773 6.909 14.33 14.80 17.10 17.71 30 6.097 7.540 9.305 11.45 14.02 17.09 20.73 25.00 35 6.478 8.109 10.13 12.72 15.64 19.29 23.67 28.86 40 6.821 8.631 10.90 13.72 17.19 21.43 26.54 32.68 45 7.134 9.114 11.62 18.68 23.50 29.37 36.47 14.77 15.78 50 7.422 9.565 12.31 20.12 25.51 32.14 40.22 60 7.941 10.39 13.57 17.67 22.87 29.41 37.57 47.65 70 8.401 11.13 14.74 19.43 25.47 33.17 42.87 54.99 80 8.814 11.82 15.82 21.09 27.96 36.80 48.05 62.25 90 9.191 12.45 16.83 22.67 30.35 40.32 53.14 69.45 100 9.539 13.03 17.79 24.18 32.65 43.75 58.14 76.59 120 10.16 14.11 19.57 27.02 37.05 50.39 67.93 90.71