If a company were to increase its appraisal costs by inspecting more units as the units are completed,the company's internal failure costs:
A)would usually increase.
B)would usually decrease.
C)would usually remain the same.
D)could not be predicted.

Question

Quizplus · Accepted Answer

Internal failure costs are the costs incurred when a defective unit is produced but not detected until after the production process is complete. If a company increases its appraisal costs by inspecting more units as they are completed, it is more likely to detect defective units before they are completed, which would reduce internal failure costs.

If a Company Were to Increase Its Appraisal Costs by Inspecting