The optimal level in the trade-off between measurement and error costs is when
A)measurement costs are greater than error costs.
B)measurement costs are less than error costs.
C)measurement costs equal error costs.
D)the total of measurement costs and error costs are maximized.

Question

Quizplus · Accepted Answer

The optimal level in the trade-off between measurement and error costs is when measurement costs equal error costs. This means that neither measuring too much nor accepting too much error is the most cost-effective option. It is important to find the right balance between the two to minimize overall costs.

The Optimal Level in the Trade-Off Between Measurement and Error