Plots of Sample Ranges Indicate That the Most Recent Value

question 21

Multiple Choice

Plots of sample ranges indicate that the most recent value is below the lower control limit. What course of action would you recommend?

• A) Since there is no obvious pattern in the measurements, variability is in control.
• B) One value outside the control limits is insufficient to warrant any action.
• C) Lower than expected dispersion is a desirable condition; there is no reason to investigate.
• D) The process is out of control; reject the last units produced.
• E) Variation is not in control; investigate what created this condition.

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Definitions:

Marginal Cost

The increase in total cost that arises from an increase in the production of one additional unit of a good or service.

Profit-Maximizing Seller

A seller who adjusts prices and production levels to achieve the highest possible profit from their goods or services.

Short-Run Marginal Costs

The increase in total cost that arises from producing one additional unit of output when some inputs are considered fixed in the short term.

Market Price

The current price at which a good or service can be bought or sold on the open market, determined by supply and demand forces.