Natural Variations

question 121

Multiple Choice

Natural variations:

• A) are variations that are to be identified and investigated.
• B) are variations that can be traced to a specific cause.
• C) are the same as assignable variations.
• D) lead to occasional false findings that processes are out of control.
• E) play no role in statistical process control.

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Definitions:

Variable Cost

Costs that vary directly with the level of production or business activity.

Machine Hour

A measure of production time, specifically the number of hours a machine is operated in the manufacturing process.

Fixed Cost

A cost that does not change with an increase or decrease in the amount of goods or services produced.

Total Expense

The sum of all costs and expenses incurred by a business during a specific period.