Ladder Manufacturing Specifies the Quality Characteristic of One of Its $\pm$

question 30

Multiple Choice

Ladder Manufacturing specifies the quality characteristic of one of its popular products to be 0.400" $\pm$ 0.010.An analysis of company records for the last two years suggests that the average cost for warranty repair or replacement is $100 per unit.The customer service manager believes that the product is likely to fail during the warranty period when the quality characteristic exceeds on either side of the target of 0.400,by the tolerance of 0.010.What is the amount of the estimated loss,L(x) ,using a Taguchi loss function,when the actual quality characteristic,x,is 0.405?

• A)$25.
• B)$5,000.
• C)$10,000.
• D)$400,000.
• E)$405,000.

---

Definitions:

Intuitive Method

A cost-based approach to finding an initial solution to a transportation problem.

Improvement Index

An indicator or metric used to quantify the level of improvement in a process, product, or service over time.

Stepping-Stone Method

An iterative technique for moving from an initial feasible solution to an optimal solution in the transportation method.

Fixed Costs

Expenses that do not change with the level of production or sales over a certain period, such as rent, salaries, and insurance.