Question

The marketing manager of the ABC Commercial Company has approached you, the quality manager, to discuss the bottle - filling operation for one the company's top - selling product lines. The bottle- filling process is designed to dispense of 16 ounces of liquid; however, there is variation on the filling process. Based on the historical data, it has been determined that the filling operation can be modeled using a normal distribution with a mean 16.05 ounces and a standard deviation of 0.15 ounces. A contract with your top customer ( 100,000 units/year) states that a $1.50 penalty will be assessed for any units that contain less than 15.8 ounces. Based on the current operation, and the information provided, what penalty can you expect to incur over the course of a year? Show all Work organized!

Answer 1

Solution: