103 a Company Produces a Product Which Is Designed to Weigh

question 101

Multiple Choice

103. A company produces a product which is designed to weigh 10 oz., with a tolerance of + 0.5 oz. The process produces products with an average weight of 9.95 oz. and a standard deviation of 0.10 oz. According to the process capability ratio is the process capable of meeting design specifications?

• A) No, the process capability ratio is less than 1.0
• B) Yes, the process capability ratio is less than 1.0
• C) No, the process capability ratio is greater than 1.0
• D) Yes, the process capability ratio is greater than 1.0

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Definitions:

Price

The cost anticipated, necessary, or paid out in return for acquiring something.

Long-Run Price

The price level at which economic forces such as supply and demand are balanced over a longer time frame, considering all inputs are variable.

Output

The amount of goods or services produced by a business, industry, or economy within a given period.

Perfectly Competitive Industry

A perfectly competitive industry is a market structure where many firms offer identical products, there are no barriers to entry or exit, and each firm has no influence over the market price.