If 200 labor hours were required to produce the 1st unit in a production run and 60 labor hours were required to produce the 7th unit, what was the learning-curve rate during production

65 %

Explanation:

Efficiency increases as the same task is performed repeatedly and thus the time required to complete the task reduces. The percentage reduction in the time  required to complete the task is known as the learning-curve rate.

Step 1

Determine the Cumulative Production Quantity

This is the total number of units made since the first unit

1st unit =  1 unit

7th unit = 8 units

Step 2

Determine the Cumulative Time per unit

This is the the total of the individual time per unit of all made to date

1st unit = 200 hours

7th unit = 200 + 60 = 260 hours

Step 3

Determine the average time per unit

This is the cumulative time per unit divided by cumulative production quantity

1st unit = 200 hours ÷ 1 = 200 hours

7th unit = 260 hours ÷ 2 = 130 hours

Step 4

Calculate Learning curve rate

130 hours / 200 hours × 100 = 65 %

Conclusion :

Therefore, the learning-curve rate during production is 65 %

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