When a Machine Is Working Properly Only 4% of the Units

question 118

Multiple Choice

When a machine is working properly only 4% of the units it produces are defective.When it slips out of adjustment, the rate jumps to 25% and the machine has to be shut down and adjusted.On 90% of the mornings when production restarts, the machine is in proper adjustment.You turn on the machine this morning and produce the first unit.If the first unit is defective, what is the probability that the machine is in adjustment?

• A).563
• B).360
• C).10
• D).536
• E).618

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Definitions:

Economic Man

A theoretical concept in economics that depicts an individual as a rational and self-interested agent, making decisions to maximize their utility.

Frederick W. Taylor

An American engineer and management consultant who is known as the father of scientific management, focusing on efficiency and labor productivity.

Piece Rates

A payment method in which a worker is paid a fixed rate for each unit produced or action performed, regardless of time.

Unity of Direction

A management principle suggesting that all parts of an organization should be aligned and moving towards common objectives.