Learning curve, incremental unit-time learning model. Assume the same information for @

Global Defence as in Exercise 10-27, except that Global Defence uses a 90% incremental 1T.o talvariablecocte oF unit-time learning model as a basis for predicting direct manufacturing labour-hours. (A 90% producing 2 units, $388,000 learning curve means b = —0.152004.)

REQUIRED 1. Calculate the total variable costs of producing 2, 3, and 4 units.

2. If you solved Exercise 10-27, compare your cost predictions in the two exercises for 2 and 4 units. Why are the predictions different? How should Global Defence decide which model it should use?

LO1