Explain the Value of Learning Effects and Provide Examples of Industries

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The Answer is Learning effects refer to cost savings that come from learning by doing. Labor, for example, learns by repetition how to carry out a task, such as assembling airframes, most efficiently. Labor productivity increases over time as individuals learn the most efficient ways to perform particular tasks. Equally important in new production facilities, management typically learns how to manage the new operation more efficiently over time. Hence, production costs decline due to increasing labor productivity and management efficiency, which increases the firm's profitability. Student examples will vary but some possible industries that may benefit include automobile manufacturing and assembly line work for making everything from furniture to computers.

Explain the Value of Learning Effects and Provide Examples of Industries

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