XYZ Ltd has trouble in the budgeting process because it finds it necessary to quantify the learning effect as new products are introduced. Substantial product changes occur and result in the need for retraining. An order for 30 units of a new product has been received,14 units have been completed. The first unit required 40 hours of labour and a total of 240 hours of direct labour have been recorded for the 14 units. The production manager expects an 80% learning effect for this type of work. The following information is available. Direct material R30.00 Direct labour R12.00 Variable overhead R0.50 per direct labour hour Fixed overhead R6000 per four-week operating period. There are 10 direct employees working a five-day week, 8 hours a day. Personal and other downtime allowances account for 25% of the total available time. Required a) Determine whether the assumption of an 80% learning effect is reasonable in this case. Use the standard formula y = ax b Where y is the cumulative average direct labour hours per unit (productivity) a = the average labour time per unit for the first batch x = the cumulative number of batches produced b= index of learning (6) b) Calculate the number of direct labour hours likely to be required to produce 30 units. (6)