The First Unit of a Product Took 832 Hours to Build

question 92

Multiple Choice

The first unit of a product took 832 hours to build, and the learning curve is 75%. How long will it take to make the 30th unit? (Use at least three decimals in the exponent if you use the logarithmic approach.)

• A) less than 200 hours
• B) from 200 to 225 hours
• C) from 225 to 250 hours
• D) from 2501 to 275 hours
• E) 275 or more hours

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Definitions:

Demand Function

A mathematical representation of the relationship between the quantity demanded of a good and its influencing factors, like price.

Cobb-Douglas

A type of production function used in economics to represent the relationship of an output to inputs, specifically capital and labor, with constants denoting the output elasticity of each input.

Perfect Substitutes

Two or more goods that can be used in place of one another with no loss of utility for the consumer, resulting in constant marginal rates of substitution.

Perfect Substitutes

Goods or services that can be used in exactly the same way and are interchangeable by consumers.