A Quality Control Inspector Keeps a Tally Sheet of the Numbers

question 40

Essay

A quality control inspector keeps a tally sheet of the numbers of acceptable and unacceptable products that come off two different production lines. The completed sheet is shown below. $$\begin{array} { | c | c | c | } \hline \text { Production line } & \begin{array} { c } \text { Acceptable } \\\text { products }\end{array} & \begin{array} { c } \text { Unacceptable } \\\text { products }\end{array} \\\hline 1 & 152 & 48 \\\hline 2 & 136 & 54 \\\hline\end{array}$$ Can the inspector infer at the 5% significance level that production line 1 is doing a better job than production line 2?

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Definitions:

Break-Even Point

The production level or sales volume at which total revenues equal total expenses, resulting in neither profit nor loss.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business, such as rent, salaries, and insurance.

Contribution Per Unit

The amount of revenue from each unit sold that contributes to covering fixed costs and generating profit.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, or insurance premiums.