Internal Reports on Quality at the Acme Publishing Company Generated

question 23

Multiple Choice

Internal reports on quality at the Acme Publishing Company generated the following information for the Trade Division for the first three months of the year: $\begin{array}{lr}\text { Total sales } & \$ 1,000,000 \\\text { Costs of quality: } & \\\text { Prevention } & 50,000 \\\text { Appraisal } & 47,000 \\\text { Internal failure } & 36,000 \\\text { External failure } & 64,000\end{array}$
Compute the ratio of costs of nonconformance to total costs of quality.

• A) 39.4%
• B) 50.8%
• C) 60.5%
• D) 100%

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Definitions:

Restriction

A rule or condition that limits or controls someone's actions or a particular activity.

Business Elsewhere

The decision by a customer to take their business to a competitor or alternative provider, usually due to dissatisfaction.

Necessary

Items or services considered essential for basic living and survival, often distinguishing between luxury goods and necessities for legal and economic purposes.

Custom-Made

Items or products that are specifically designed and produced to meet the unique requirements of an individual or entity.