You Have Just Used the Capability Index (Cpk) Formulas to Compute

question 58

Multiple Choice

You have just used the capability index (Cpk) formulas to compute the two values "min [1.5, 1]." Which of the following is the interpretation of these numbers?

• A)The true capability index value is 1.
• B)The mean of the production process has shifted to the left of the design limits.
• C)The mean of the production process has shifted to the right of the design limits.
• D)The mean has not shifted at all.
• E)The true capability index value is between 1.5 and 1.

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Definitions:

Transaction Costs

Transaction costs are expenses incurred when buying or selling a good or service, which include fees, taxes, and other charges associated with the transaction.

Absolute Purchasing Power Parity

A theory that suggests that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries.

Forward Exchange Rates

Exchange rates determined today for currencies to be exchanged at a future date, used in hedging and speculation.

Spot Rates

The current market price of a financial instrument, commodity, or currency for immediate delivery and payment.