Question # 4 Atkinson Research Association (ARA) had received a contract to produce two units of new high-tech wireless system. The first unit took 2900 labor hours to complete and cost $32500 in materials and equipment usage. The second took 2465 labor hours and cost $22750 in material and equipment usage. Labor cost charged at $34 per hour. ARA completed the first order and got second order of 10 more units. They completed second order successfully. Assume same learning continues. The prime contractor now approached ARA and asked to submit a bid for producing 18 units of high-tech wireless system.

a. What will the cost of last unit of this follow-on contract?

b. What will be the average labor hours required for producing follow-on contract of 18 high-tech wireless system?

c. What will the average total cost of the follow-on contract of 18 high-tech wireless system?

d. ARA completed and delivered the follow-on contract of 18 high-tech wireless system. They released their labor and equipment to other projects. After long time prime contractor has now approached with another order of 20 units of high-tech wireless system. Suppose there was significant delay between the last follow-on contract of 18 units and this order. ARA labor rate is increase from $34 to $46 per hour and cost of material is increase by 18%. Calculate the cost of this new order of 20 units under assumption that learning didnt continues and they forget what they learned due to the significant delay between orders. Note:

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