Comparing Traditional View of the Cost of Variability and Taguchi's

question 32

Multiple Choice

Comparing traditional view of the cost of variability and Taguchi's view of cost of variability,

• A)Both views are about the same.
• B)Traditional view holds that as long as the product is within specification, there is no difference.
• C)Taguchi's view holds that closer to the midpoint of specifications better it is.
• D)B and C are true.
• E)None of the above.

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Definitions:

Break-Even Point

The point at which total costs and total revenue are equal, meaning that there is no net loss or gain, and one has "broken even."

Fixed Costs

Fixed costs that are unaffected by production or sales volume, like rent, employee salaries, and insurance fees.

Contribution Per Unit

The amount of money each unit sold contributes towards covering fixed costs and generating profit.

Break-Even Analysis

A financial calculation to determine the point at which revenue received equals the costs associated with receiving the revenue, indicating no net loss or gain.