The cumulative average time per unit produced is assumed to fall by a constant percentage every time the total of output doubles. As with all rather vague theories, there is some evidence to show that this is the case. In 1996, Rolls Royce won a contract to supply engines to a far eastern airline worth 600 million. It imposed very severe conditions on sub-contractors and suppliers on the contracts awarded. Clearly Rolls Royce expect suppliers to make use of the learning curve concept.
Quality is more important than quantity.
Payback - The length of time that is required for cash proceeds from an investment to recover the original cash outlay required by the investment. Discounting the cash inflows and then deducting the cash outflows. You are looking for the discount factor which results in a net present value of zero.