Once Production Is Underway and the Learning Curve Effect Is

question 200

Multiple Choice

Once production is underway and the learning curve effect is occurring, successive changes made to the production process will cause the time per unit to:

• A)continue following the original learning curve without any impact.
• B)cause a scallop effect.
• C)increase the unit time and result in a higher percentage learning curve.
• D)decrease the unit time and result in a higher percentage learning curve.
• E)decrease the unit time and result in a lower percentage learning curve.

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Definitions:

Net Operating Income

A measure of a company's profitability from its regular business operations, excluding deductions of interest and taxes.

Gross Margin

The difference between revenue and cost of goods sold, used to cover other expenses and profits.

Sales

The total amount of goods or services sold by a company within a specific period.

Residual Income

Earnings that exceed the minimum required return on an investment or project.