If the Cost of Replacing a Defective DVD Disk Once

question 27

Multiple Choice

If the cost of replacing a defective DVD disk once it has been shipped is $2.00, while the cost of 100% inspection prior to shipment is $.40 each, at what point is he indifferent between 100% inspection and shipment without inspection?

• A)0% defectives
• B)2% defectives
• C)5% defectives
• D)20% defectives
• E)30% defectives