hey doubt in learning curve theory

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sabitha (Querist)
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20 July 2011 in ca final cost management, in padukas saravana prasath book,page 19.4,sum no3,i have doubt.....
question:a plane costs 1500 lacs to manufacture and exhibits an 85%learning curve .calculate the cost of each of the first five planes.
cost of first 5 planes:
answer : 1. 1500 lacs*1.000 = 1500lacs
2 1500lacs*0.8500 = 1275lacs
3 1500lacs*0.7730 = 1159.5lacs
4 1500lacs*0.7230 = 1084.5lacs
5 1500lacs*0.6860 = 1029lacs
my doubt is how did the numbers 1.000,.8500,.7730,.7230,.6860 come........how to get those numbers????if anyon eknows the answer..please explain in detail....

Ravikant

Ravikant (Expert)
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20 July 2011 For 1 : It is 100 % i.e. 1.000
For 2 and 4 :(For Double units)
1.000*85% = 0.8500 and 0.8500*85%= 0.7230

For Odd Units 3 and 5 :
You have to Use Logarithm Formulae, which is given in the Book in the Beginning of the chapter,,

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