Kelly-Lambing Inc, a builder of government contracted small ships has a steady w
ID: 2748070 • Letter: K
Question
Kelly-Lambing Inc, a builder of government contracted small ships has a steady work force of 10 very skilled craftspeople. These workers can supply 2,400 labor-hours each per year. Kelly-Lambing is about to undertake a new contract, building a new style of boat. The first boat is expected to take 6,100 hours to complete. The firm thinks that 75% is the expected learning rate. What is the firms capacity to make these boats-that is,
how many units can the firm make in 1 year?
If the operations manager can increase the learning rate to 70% instead of 75%, how man units can the firm make?
What is the total time available?
Explanation / Answer
Total Time Available = 10 * 2400 = 24000 hours Time for First Unit = 6100 units Learning Curve Rate = 75% Learning Curve Factor = Total Time Available / Time for first unit = 24000 / 6100 = 3.934 Using Learning Curve tables at 75% No Units that can be produced = 6 Using Learning Curve tables at 70% No Units that can be produced = 7
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