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?

Essentials of Business Analytics (MindTap Course List)
2nd Edition
ISBN:9781305627734
Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Chapter5: Probability: An Introduction To Modeling Uncertainty
Section: Chapter Questions
Problem 20P: Many companies use a quality control technique called acceptance sampling to monitor incoming...
icon
Related questions
Question

Graph the OC curves for the sampling plan described in Problem 58 for both manufacturers A and B.

Problem 58

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?

 

Expert Solution
steps

Step by step

Solved in 3 steps with 6 images

Blurred answer
Knowledge Booster
U.S. Generally Accepted Accounting Principles (GAAP) Provisions
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials of Business Analytics (MindTap Course …
Essentials of Business Analytics (MindTap Course …
Statistics
ISBN:
9781305627734
Author:
Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L…
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning