Ledd Electronics Has Received a Large Shipment of Power Supply

question 27

Essay

Ledd Electronics has received a large shipment of power supply units for the desktop computers being assembled. The units are coming from a new supplier and Ledd is not sure what the actual defect rate will be for this component. Ledd is considering an acceptance sampling plan with n = 30 and c = 1.
a. Find the probability of accepting a lot when the defect rate is 2%, 4%, and 6%.
b. What happens to the producer's risk as the defect rate increases?
c. What happens to the consumer's risk as the defect rate increases?

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Definitions:

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products or job orders, calculated before the accounting period begins based on an estimate.

Machine-Hours

A measure of the amount of time a machine is operated, used for allocating machine-related costs to individual units of production.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products or job orders based on a specific activity base, such as labor hours or machine hours.

Machine-Hours

A measure of the amount of time a machine is operated within a given period.