If the Upper and Lower Specification Limits of a Process

question 83

Multiple Choice

If the upper and lower specification limits of a process are .852 and .828,respectively,and the process standard deviation is .002,then the process capability index C_p is

• A) .024
• B) 2.000
• C) -2.000
• D) 12.000

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Definitions:

Accounting Profit

The total revenue of a business minus the explicit costs, representing the financial gain on its income statement.

Economic Cost

The total cost of choosing one action over another, including both the costs incurred and the opportunity costs of forgone alternatives.

Financial Capital

Refers to the funds provided by lenders (and investors) to businesses to purchase real capital.

Machinery

Equipment and devices that perform specific tasks in industries, contributing to production processes.