Acme,Inc,Produces Widgets

question 62

Multiple Choice

Acme,Inc.,produces widgets.To manufacture a new type of widget,it took 52 hours for the first widget.Acme estimates it has an 82% learning rate.Using the logarithmic approach,calculate the time it will take to manufacture the 87th widget.

• A)17.78 hours
• B)14.51 hours
• C)16.52 hours
• D)15.94 hours

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Definitions:

European Option

A type of options contract that can only be exercised at the expiration date, not before.

Expiration Date

The date on which a contractual agreement, option, or financial instrument becomes invalid or requires renewal.

Exercise Price

The predetermined price at which an option contract can be executed.

Call Option

A financial contract giving the buyer the right, but not the obligation, to buy a stock, bond, commodity, or other asset at a specified price within a fixed time period.