1. In the analysis of Cost of Quality, the cost incurred after selling defective
ID: 343578 • Letter: 1
Question
1. In the analysis of Cost of Quality, the cost incurred after selling defective products to customers is referred to as:
Appraisal cost
Prevention cost
Internal failure cost
External failure cost
2
An activity in a PERT network has these time estimates: optimistic = 3, most likely = 6, and pessimistic = 8. Its expected completion time is:
5.67
5.83
5.00
6.13
3. Which of the following statements is INCORRECT regarding CPM and PERT?
Only critical activities contribute to the variance of the project completion time in PERT.
CPM includes uncertainty in activity times.
PERT uses Beta distribution to determine the mean activity time and the variance of an activity.
ES, EF, LS, and LF can be determined in both CPM and PERT networks.
Appraisal cost
Prevention cost
Internal failure cost
External failure cost
Explanation / Answer
Solution :
1 : Option : D : External Failure Cost
External failure costs are incurred to remedy defects discovered by customers. These costs occur when products or services that fail to reach design quality standards are not detected until after transfer to the customer.
2 : Option : B : 5.83
Expected completion time = ( 3 + 4*6 + 8 ) / 6 = 5.83
3 : Option : B : CPM includes uncertainty in activity times.
CPM does not consider the time variations that can have a great impact on the completion time for a complex project
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