Question: Over the last few months, Ithaca Precision Instruments (IPI) obtained the following measurements on a key quality characteristic of its product: Observed Quality Characteristic Probability
Over the last few months, Ithaca Precision Instruments (IPI) obtained the following measurements on a key quality characteristic of its product:
| Observed Quality Characteristic | Probability |
| 0.46 | 0.01 |
| 0.47 | 0.10 |
| 0.48 | 0.12 |
| 0.49 | 0.15 |
| 0.49 | 0.31 |
| 0.51 | 0.15 |
| 0.52 | 0.09 |
| 0.53 | 0.06 |
| 0.54 | 0.01 |
The company's experience has been that a customer will reject a product that deviates from the target quality characteristic of 0.50 by more than 0.040. Each rejection costs the firm an estimated $5.95. Determine the expected total quality loss of the observed quality characteristic for IPI. (Round intermediate and final answer of to 4 decimal places.)
A. 99.1188
B. 75,6813
C. 28,8063
D. 1.1937
E. 205.5687
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