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If Points on a Control Chart Are Determined to Be

question 62

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If points on a control chart are determined to be the result of special causes,the points should be eliminated and new control limits should be computed.


Definitions:

Optimal Output

The level of production that maximizes a firm’s profit or minimizes its cost under given conditions.

Profit

The financial gain acquired when the revenue generated from business activities exceeds the expenses, costs, and taxes needed to sustain the activity.

Industry Supply Curve

A graph that shows the relationship between the price of a good and the total output of the industry for that good.

Price Levels

The mean value of present prices for all goods and services created within the economy.

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