A quality characteristic has a manufacturing specification (in cm) of 0.200 ± 0.05. Historical data indicate that if the quality characteristic takes on values larger than 0.25 cm or smaller than 0.15 cm, the product fails and a cost of $75 is incurred. Given the Taguchi loss function that was computed and actual process performance of this quality characteristic of 0.135, what is the economic loss per part?
A) More than $50 but less than or equal to $100
B) More than $100 but less than or equal to $200
C) More than $200 but less than or equal to $300
D) More than $300

Question

Quizplus · Accepted Answer

The Taguchi loss function is L(x) = k(x-T)^2, where T is the target value (0.200 cm), x is the actual value (0.135 cm), and k is the loss coefficient. The loss coefficient k can be calculated using the failure cost and specification limits. Since the actual value is outside the specification limits, the economic loss is significant, falling in the range of more than $100 but less than or equal to $200.

A Quality Characteristic Has a Manufacturing Specification (In Cm) of 0.200