Question

a) XYZ Ltd. produces silicon chips, 1000 at a time in a batch. The company has to ensure that it does
not supply defective chips as they are critical to the functioning of computer. If buyer receives a
defective chip, XYZ has to pay a penalty of Rs. 150 per chip. XYZ wants to test chip quality before
shipping them to buyers. It can use any of two tests for quality control. Test 1 cost Rs. 6 per chip
but it detects only 80% of all defective chips. Test 2 costs Rs.9 per chip and can detect all defective
chips. XYZ can rework defective chips at a cost of Rs. 75 per chip to ensure that the buyer does
not receive any defective chip. (Let 'n' be the number of defective chip per batch)

1. XYZ Ltd. Should not use any quality control test, if it is expected that
(a) n<100
(b) 100<n<200 (c) n>200

2. If 200<n<400, then
(a) XYZ Ltd. Should use Test 1
(b) XYZ Ltd. Should use Test 2
(c) XYZ Ltd. Can use Test 1 or Test 2
(d) XYZ Ltd. Should use both Test 1 and Test 2
(e) None of these

3. If n=100, XYZ Ltd. Should use
(a) Test 2 (b) Test 1 and Test 2
(c) Test 1 or Test 2
(d) Test 1 or No Test
(e)None of these

4. If n=170, XYZ Ltd. Should use
(a) Test 1 (b) Test 2 (c) Test 1 or Test 2
these
(d) Test 1 and Test 2
(e)None of these

5. What should be the value of n where XYZ Ltd. Can use Test 1 or Test 2?
(a) 200
(b) 300
(c) 100
(d) 175
(e) 250
​

Answer 1

Answer:

1. n<100

2.XYZ LTD SHOULD BE TEST 2

Step-by-step explanation:

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