If in Conducting a Study to Determine What Modifications Should

question 5

Multiple Choice

If in conducting a study to determine what modifications should be made on an existing product the researcher assigns weights of 4.0 to heavy users,3.0 to medium users,2.0 to light users,and 1.0 to nonusers.Which group's opinion has greater importance?

• A)nonusers
• B)light users
• C)medium users
• D)heavy users

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Definitions:

Expected Value Criterion

A decision-making approach based on the weighted average of all possible outcomes, with each outcome's weight being its probability of occurrence.

Variable Cost

Costs that change in proportion to the level of activity or volume of production, such as materials and labor costs.

Setup Cost

The cost to prepare a machine or process for production.