Cost estimation, incremental unit time learning curve. Assume the same information for the Nautilus Company as that in requirement 1 of Problem 10-32 with one exception, that Nautilus uses an 85% incremental unit time learning curve as a basis for forecasting direct manufacturing labour-hours on its assembling operations. (An 85% learning curve implies b = -0.2345.)

Required 1. Prepare a prediction of the total expected costs for producing the seven PT109s for the Coast Guard.

2. If you solved requirement 1 of Problem 10-32, compare your cost prediction there with the one you made here. Why are the predictions different?