A Quality Analyst Wants to Construct a Control Chart for Determining

question 109

Multiple Choice

A quality analyst wants to construct a control chart for determining whether four machines, all producing the same product, are in control with regard to a particular quality attribute. Accordingly, she inspected 1,000 units of output from each machine in random samples, with the following results: $$\begin{array} { c c } \text { Machine } & \text { Total Defectives } \\\hline \# 1 & 23 \\\# 2 & 15 \\\# 3 & 29 \\\# 4 & 13\end{array}$$
What is the estimate of the process proportion of defectives?

• A) .08
• B) .06
• C) .04
• D) .02
• E) .01

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Definitions:

Accounts Receivable Approach

The accounts receivable approach is a method used in financial analysis to estimate the impact of credit sales and receivables on a company's cash flow and profitability.

Net Present Value

Net present value (NPV) is a financial metric that calculates the difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment.

Cost Of Switching

The cost of switching refers to the expenses and inconveniences a customer or company faces when changing products, services, or suppliers, including termination fees, setup costs, and time.

Incremental Cash Inflow

Additional cash earnings a company receives from undertaking certain actions, such as launching a new product or project.