1. Which of the following would be a hidden quality cost?
a. Inspecting and testing prototypes
b. Repairing a computer still under warranty
c. Stopping work to correct process malfunction (discovered using statistical process control procedures)
d. Lost market share due to poor product performance
2. Using the Taguchi quality loss function, an average loss of $20 per unit is calculated. During the year, 25,000 units were produced. Which of the following statements represents the correct application of the Taguchi loss function?
a. The hidden costs of internal failure are $500,000.
b. The hidden costs of external failure are $500,000.
c. The costs of detection activities are $20 per unit inspected.
d. The total external costs are $500,000.