Suppose that only two incoming fraction defective levels, 2 percent and 6 percent, are possible. The 2 percent incoming fraction defective level is twice as likely as the 6 percent. At a 2 percent incoming fraction defective, there's an 80 percent chance that a lot will be accepted. At 6 percent incoming fraction defective, there's a 20 percent chance that a lot will be accepted. Lots that are not accepted are subject to 100 percent sorting. What is average outgoing quality (approximately)?
A) 1.60 percent
B) 1.47 percent
C) 1.20 percent
D) .73 percent
E) .80 percent

Question

Quizplus · Accepted Answer

The average outgoing quality (AOQ) is calculated by considering the probability of acceptance and the fraction defective for each incoming level. The probability of a 2% defective lot is 2/3, and for a 6% defective lot, it is 1/3. The AOQ is calculated as: AOQ = (2/3 * 0.02 * 0.8) + (1/3 * 0.06 * 0.2) = 0.01067 + 0.004 = 0.01467 or approximately 1.47 percent.

Suppose That Only Two Incoming Fraction Defective Levels, 2 Percent