A company is contracted to produce 10,000 steel shafts with a diameter of 2cm in

Question

A company is contracted to produce 10,000 steel shafts with a diameter of 2cm in one week (5 days with 8 hrs / day. The company does not have high-end Lathes arid, hence, the diameter variability is large. Moreover, the lathes can only produce 300 shafts br. Part specifications require that the diameter not be off by more than 0.02cm, otherwise they are not acceptable and will be returned at no cost to the client. Each returned part costs the company $1.50 (material costs are mitigated by recycling). Moreover, the company can't absorb returned part losses on thin job that exceed $10,000. Prior to starting this job, the chief engineer runs a small batch of 50 parts, From this small but representative population, he finds the average diameter is x = 2cm. as required He also finds a standard deviation of sigma = 0.01cm. Is this satisfactory? In other words, can the company produce the necessary parts in time without exceeding the maximum returned parts cost'.' If not, what would haw been the minimum acceptable standard deviation?

Explanation / Answer

Check those link http://www.cramster.com/answers-sep-11/statistics-and-probability/probability-question_1486828.aspx?rec=0 http://www.cramster.com/answers-sep-11/statistics-and-probability/probability-question_1486669.aspx?rec=0

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