On a Cost of Quality Report, Which of the Following

question 191

Multiple Choice

On a Cost of Quality report, which of the following cost items should be classified as an external failure cost?

• A)Net cost of scrap
• B)Technical support provided to suppliers
• C)Customer returns of defective products
• D)Supplies used in the quality inspection program

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Definitions:

Oligopoly

A market structure characterized by a small number of firms dominating the market, leading to limited competition and higher prices for consumers.

High Barriers

Obstacles that make it difficult for new entrants to enter a market, including high starting costs, stringent regulations, or strong competition.

Differentiated Products

Goods or services that are distinguished from others by quality, branding, or other features, leading to non-price competition among firms.

Collude

When two or more firms work together to set prices, limit supply, or engage in other practices to restrict competition and manipulate market outcomes.