A Bottled Water Plant Utilizes a Production Process Designed to Fill

question 37

Essay

A bottled water plant utilizes a production process designed to fill bottles with 20 ounces of water.The population of filling volumes is normally distributed with a standard deviation of 1.3 ounces.Periodically,process engineers take 20-bottle samples and compute the sample mean.
A)What are the upper and lower control limits?
B)Suppose the last five sample means were 19.4,20.2,20.5,20.7,and 21.1 ounces.Is the process under control?

• A)What are the upper and lower control limits?
• B)Suppose the last five sample means were 19.4,20.2,20.5,20.7,and 21.1 ounces.Is the process under control?

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Definitions:

Net Present Value

A method used in capital budgeting to assess the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows.

Present Value Method

A financial calculation that determines the current worth of a future sum of money or stream of cash flows given a specific rate of return.

Ignore Present Value

A decision to not consider the current worth of future cash flows or payments, often applied in financial analysis.

Average Rate of Return

A financial ratio used to estimate the profitability of an investment, calculated as the net profit divided by the initial cost of investment.