A Lot of 1,000 Items Is on the Loading Dock

question 42

Multiple Choice

A lot of 1,000 items is on the loading dock.A single-sampling plan calls for a sample size of 10.The following table gives the probability of acceptance for the plan over a range of possible quality levels.
$$\begin{array} { | c | c | } \hline \begin{array} { c } \text { Proportion } \\\text { Defective }\end{array} & \begin{array} { c } \text { Probability of } \\\text { Acceptance }\end{array} \\\hline 0.01 & 0.97 \\\hline 0.02 & 0.85 \\\hline 0.03 & 0.60 \\\hline 0.04 & 0.50 \\\hline 0.05 & 0.24 \\\hline 0.06 & 0.05 \\\hline\end{array}$$
What is the average outgoing quality limit for this plan?

• A) Less than or equal to 0.018
• B) Greater than 0.0180 but less than or equal to 0.0200
• C) Greater than 0.0200 but less than or equal to 0.0220
• D) Greater than 0.0220

Comprehend the return on investment (ROI) metric and its application in evaluating divisional performance.

Analyze the factors determining the minimum required rate of return in different contexts.

Calculate margin and turnover components of ROI.

Determine appropriate investment opportunities based on residual income calculations.

---

Definitions:

FOB Destination

A shipping term indicating that the seller is responsible for goods and shipping costs until the goods reach the buyer's specified location.

Merchandise

Goods bought for the purpose of resale at a profit.

Accounting Equation

The fundamental equation that represents the relationship among assets, liabilities, and equity of a company; Assets = Liabilities + Equity.

Income from Operations

Profit generated from a company’s regular business activities, excluding non-operating income and expenses.