Differentiate Between the Traditional and the Taguchi Approaches to Deviations

question 132

Essay

Differentiate between the traditional and the Taguchi approaches to deviations from a target dimension or measurement.

---

Definitions:

Negative Externality

An adverse effect on a third party not directly involved in a transaction, which results from economic activity without compensation.

Negative Externality

A cost suffered by a third party due to an economic transaction, without compensation.

After-Tax Equilibrium

The balance reached in the market after accounting for the effects of taxes.

Socially Optimal Quantity

The level of output or production that maximizes societal welfare, taking into account all external costs and benefits.