Detailed Answer
Answer (D) is correct. Learning curve analysis is used to project productivity gains resulting from the increased rate at which people perform tasks as they gain experience. The underlying assumption of learning curve analysis is that workers gain productivity at a predictable rate as they gain experience with a new process. For this company, a total of 8,000 hours was spent to complete two lots of product. The cumulative average spent on the two lots was therefore 4,000 hours per lot (8,000 ÷ 2). This cumulative average of 4,000 is 80% of the 5,000 hours that were spent on the first lot. The learning curve is therefore 80%.