Discussion
Spreading RDT&E over a larger production quantity
Answer: D
Correct answer: Reduces amortised development cost
RDT&E is a one-off expense incurred before the first delivery, so dividing it over more aircraft reduces the share each must carry:
\[ \text{amortised cost} = \frac{\text{RDT\&E}}{N} \]
A \( 2.4 \) billion dollar development spread over 300 aircraft adds 8 million dollars each; over 600 it adds only 4 million. The total programme cost rises with quantity because more aircraft are built, but the unit production cost falls through learning as well, so both effects push unit cost down as the run lengthens.
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