5175063TRUE/FALSE Questions1. The cost of ensuring that the production process conforms to specifications are known as"appraisal costs"2. The cost of achieving good quality include appraisal costs3. Scrap cost is an external failure cost4. In general, when the cost of achieving good quality increases, the cost of poor qualitydeclines5. Yield is equal to the number of good units produced plus the number of defective unitswhich have been successful reworked6. The QPR increases if either processing costs or rework costs or both decrease7. Lost sales cost, as part of the cost of quality, refers to company not being able to keep upwith consumer demand for their product.8. The QPR decreases if more good quality units are produced relative to total product input.

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TRUE/FALSE Questions 1. The cost of ensuring that the production process conforms to specifications are known as "appraisal costs" 2. The cost of achieving good quality include appraisal costs 3. Scrap cost is an external failure cost

TRUE/FALSE Questions 1. The cost of ensuring that the production process conforms to specifications are known as "appraisal costs" 2. The cost of achieving good quality include appraisal costs 3. Scrap cost is an external failure cost

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

Chapter20: The Problem Of Adverse Selection Moral Hazard

Section: Chapter Questions

Problem 20.4IP

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