It has been observed in the aircraft industry that, each time cumulative output of airframes was doubled, unit costs typically declined to 80 percent of their previous level. This is an example of:

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This phenomenon is known as the experience curve, which shows that unit costs tend to decline by a predictable amount each time cumulative output doubles. This is because firms become more efficient and gain experience with their production methods, resulting in increased productivity and cost savings.

It Has Been Observed in the Aircraft Industry That, Each