When the Only Sources of Variation in a Production Process

question 33

Multiple Choice

When the only sources of variation in a production process are caused by chance,and random variation remains within acceptable limits,the process is said to be:

• A) stable.
• B) in statistical control.
• C) out of control.
• D) out of luck.
• E) Both A and B since they are the same.

---

Definitions:

Net Present Value

A calculation that compares the present value of a project's cash inflows to its cash outflows, used to assess the viability or profitability of an investment.

Interest Rate

The percentage of a loan that incurs interest costs for the borrower, often stated as an annual rate of the outstanding loan amount.

Net Present Value

A calculation that compares the value of all future cash flows of a project, discounted back to the present, to the initial investment.

Discount Rate

In finance, it's the interest rate the Federal Reserve charges banks for borrowing funds, used to control money supply.