Which of the following is not an example of an external failure cost?
A)Warranty claims
B)Handling complaints
C)Loss of customer goodwill
D)Scrap and rework during production
E)Price discounts to offset inferior quality

Question

Quizplus · Accepted Answer

Scrap and rework during production is an example of an internal failure cost, as it is incurred before the product is shipped to customers. The other options (A, B, C, and E) are examples of external failure costs, as they occur after the product has been shipped to customers and may result in customer dissatisfaction, return of products, or loss of future business.

Which of the Following Is Not an Example of an External