## Quick Reference

A technique that takes into account the reduction in time taken to carry out production as the cumulative output rises. The concept is based on a doubling of output, so that a 70% learning curve means that the cumulative average time taken per unit falls to 70% of the previous cumulative average time as the output doubles. The cumulative average time per unit is measured from the very first unit produced. The formula for the learning curve is:*y* = *ax*^{−}* ^{b}*,

*y* = *ax*^{−}* ^{b}*,

where *y* is the cumulative average time per unit of production, *a* is the time taken to produce the first unit, *x* is the cumulative number of units manufactured to date, and *b* is the learning coefficient.

*Subjects:*
Accounting.

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