A maker of personal computers, Noname, purchases 64K DRAM chips from two different manufacturers, A and B. Noname uses the following sampling plan: A sample of 10 percent of the chips is drawn and the lot is rejected if two or more defective chips are discovered. The two manufacturers supply the chips in lots of 100 and 1,000, respectively. a. For each manufacturer, determine the true proportion of defectives in the lot that would result in 90 percent of the lots being accepted. You may use the Poisson approximation for your calculations. b. Would you say that this plan is fair?

A maker of personal computers, Noname, purchases 64K DRAM chips from two different manufacturers, A and B. Noname uses the following sampling plan: A sample of 10 percent of the chips is drawn and the lot is rejected if two or more defective chips are discovered. The two manufacturers supply the chips in lots of 100 and 1,000, respectively. a. For each manufacturer, determine the true proportion of defectives in the lot that would result in 90 percent of the lots being accepted. You may use the Poisson approximation for your calculations. b. Would you say that this plan is fair?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter17: Making Decisions With Uncertainty

Section: Chapter Questions

Problem 17.3IP

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