-A Quality Manager Has Established a Sampling Plan That Calls

question 66

Multiple Choice

$$\begin{array} { | c | c | c | } \hline n & \begin{array} { c } \text { Producer's } \\\text { Risk } \\( p = \mathrm { AQL } ) \end{array} & \begin{array} { c } \text { Consumer's } \\\text { Risk } \\( p = \mathrm { LTPD } ) \end{array} \\\hline 60 & 0.122 & 0.126 \\80 & 0.191 & 0.048 \\100 & 0.264 & 0.017 \\120 & 0.332 & 0.006 \\\hline\end{array}$$
-A quality manager has established a sampling plan that calls for a sample size of 100 units and an acceptance number of 2.The supplier has agreed to a contract that calls for an AQL of 0.01 and an LTPD of .05.Which of the following statements is TRUE? Table I.1 is appended to this exam.

• A) Lowering the acceptance number to 1 will raise the probability of a type II error.
• B) Increasing the sample size will increase ?.
• C) Raising the AQL to 0.02 will lower the chance of a type I error.
• D) Reducing the LTPD to 0.04 will reduce the chance of a type II error.

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Definitions:

Financial Statements

formal records of the financial activities and position of a business, person, or other entity, typically comprising the balance sheet, income statement, and cash flow statement.

Net Debt

A financial metric calculated by subtracting a company's total cash and cash equivalents from its total short-term and long-term debt.

Government Organizations

Entities established by a government to carry out specific functions or services, operating within the public sector and funded by the government.

Accounting Standards

Rules and guidelines that prescribe the specific accounting methods and procedures to present financial statements accurately and consistently.