Question

Haliburton Manufacturing Corporation makes industrial air conditioning units for large organizations. Last year the company spent more than​ $5 million on new technology designed to make its employees more productive and streamline its business processes. The expected return on​ investment, however, was much lower than the company​ expected, and production of new air conditioners was not improving. What economic theory helps explain the reason Haliburton is not getting an immediate return on its IT​ investment?

Answer 1

The answer is: The Theory of the Learning Curve

Step-by-step explanation:

The Theory of the Learning Curve states that the time a worker requires to perform a task decreases as a he/she gains experience. The time or cost of performing a task (i.e. manufacture one air conditioning unit) decreases at a constant rate as cumulative output increases. Probably the workers haven´t had enough time to master the new production technologies and are still struggling with the new process.

This is true for everyone, for example the first time you drove a car you probably weren´t exactly "good" at it, but as time passed you got much better.