Learning Curve: Algebraic approach

mark057

Hi there,

I've come across a calculation for the formula y = ax b

The learning curve is 80% which gives a learning rate of -0.322.

The answer says a = $120.00 which is the cost of making the first unit. x = 230 cumulative units and b = -0.322 the learning curve.

It says $120.00 x (230 -0.322) = $20.83 culumlative average cost per unit.

Can someone explain how you get $120.00 from these figures using a calculator? How is the learning rate calculated against the 230 units?

Any help would be gratefully appreciated as ever.

Mark

PGM

How you get £120?

You'd divide 20.83 by (230 to the power of -0.322)

mini_schnauzer

Hi Mark057

What tution provider books are you using? They don't seem to be explaining it to you very well.

Also, I think the AAT students would prefer the ACCA F5 question to go into the new further studies section.

mark057

$120.00 was given to me in the question as the cost of producing the first unit.

I have no idea how to calculate 230 to the power of -0.322?

How do you work that out on a calculator?

Mark

PGM

Ah right, that makes sense now.

You can't do it on your big chunky calculator. You'll need a scientific one, it'll have a button that says xy or similar, (with the y being up and right of the x).

with x being the 230 and y being -0.322

mark057

Hi PGM

I have a scientific calculator with a yx button.

I've calculated 230 pressed the yx button and then 0.322 = 5.760714646.

I've tried mutiplying $120 by 5.760714646 and I'm not getting $20.85.

How would you calculate it?

I'm really confused.

Mark

PGM

Needs to be -0.322

PGM

If for some reason you can't put the negative symbol in, you can do 1 divided by (230 to the power of 0.322)

mark057

Hi PGM

I found it. You are a star, thanks so much.

Simple when you know how. I'm just really suprised the book didn't run through the calculation. Its been years since I did my GCSE Maths.

Mark

PGM

mark057 wrote: »

Simple when you know how.

No, just less hard!

I studied with Kaplan classes, and one of the first thing they did was a calculator refresher.

SandyHood

If you are preparing for the CIMA P2 exam, try to practice finding more than just [size=+1]y[/size]
Look to find:
the learning rate%
[size=+1]x[/size] and
[size=+1]a[/size]

Monsoon

mini_schnauzer wrote: »

Also, I think the AAT students would prefer the ACCA F5 question to go into the new further studies section.

I was going to say, I don't remember ever having to do things like this at AAT!