A 90% Learning Curve Implies That Each Time the Production

question 50

True/False

A 90% learning curve implies that each time the production volume is doubled, the direct time per unit is reduced to 90% of its previous value.

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Definitions:

Straight-line Method

A technique that evenly distributes the expense of an asset across its lifespan for depreciation calculation.

Discounted Payback

The period it takes for an investment to break even in cash flow terms, adjusted for the time value of money.

Required Return

The minimum gain or profit that investors expect to receive on an investment relative to its risk.

Average Accounting Rate

A financial metric that represents the average rate of return earned on investments or assets, based on accounting values.