In semiconductor and other manufacturing, what is the tendency called for the cost per unit to fall by a fixed percentage each time cumulative production doubles?

Answer: C. The experience curve (learning curve) effect

With the experience curve effect, unit costs fall as production experience accumulates, through process improvements, higher yields, greater worker proficiency and so on. It is expressed as a relationship such as costs falling 20 to 30% each time cumulative output doubles. It is one reason companies that mass-produce first gain a cost advantage.

• A. Dennard scaling describes the properties of proportionally shrinking transistors.
• B. Moore's law is an empirical rule about the growth in transistor count.
• C. Correct. It is the tendency for costs to fall with cumulative output.