Question: The function C(n) = Kna -a is an example of a learning curve. C(n) is the cost of producing the n'th unit of a


The function C(n) = Kna -a is an example of a learning curve. C(n) is the cost of producing the n'th unit of a product or service, and K > 0 and a > 0 are constants. The behaviour of the learning curve changes with the value of the constants K and a, which can be called parameters of the model. Different values describe different production processes. If you believe a process should correspond to this class of model, you could use data at different n to estimate the parameters (but that is not a part of this assignment). 3. (2 marks) ) According to this model, are efficient industries associated with a relatively small parameter a, or with a relatively large parameter a? Explain your answer carefully.
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
