Question
You won a bid to build ten roller coasters for a customer. The first roller coaster was completed in 600 hours. The crew working on
You won a bid to build ten roller coasters for a customer. The first roller coaster was completed in 600 hours. The crew working on the project have demonstrated an 75% learning curve.
a.How long should it take the same crew to finish the last nine roller coasters?
b.There are 5 crewmembers working on the project. The average labor cost per hour per crewmember, including health benefits and retirement contribution, is $100. How much will be the total labor cost for the project - that is, for completing all 10 roller coasters combined?
c.Included in the bid submitted by you are the following information: (1) Material cost per roller coaster - $10,000, (2) Overhead is 40 percent of labor and materials combined, and (3) Gross margin - 60% of material, labor, and overhead combined. How much was your bid price?
d.You won the bid. Assuming T1 remains unchanged, but you discovered that the actual learning rate for the job is 85%. How does this discovery affect you? Support your discussion with numbers (show detailed solution) using the information presented in (b) and (c) above.
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