Question

Hypothesis Testing:

The computer hardware company requires all of its chips purchased from its supplier of computer chips to meet specifications of 1.2 cm with the margins of error of plus and minus 0.1 cm.
Based on the computer chip supplied last month, the mean length of a computer chip was 0.9 cm.

->What are the elements that the production manager should consider in determining his company's ability to produce chips that meet specifications?

->Do the chips that were supplied meet the desired specifications?
->What reasons would you provide to justify that the supplier is meeting specifications?
->How will this decision impact the supplier's sales and net profit?

Answer 1

The elements that the production manager should consider in determining his company's ability to produce chips that meet specifications include the demands of retraining staff, possible modification tools, material, parts and manufacturing equipment, and revision of procedures and processes.

Based on the results of the production run last month , there is a 95% certainty that the interval, with the lower limit at .9Cm and the upper limit at 1.1.cm, contains the true process mean. There is a 5% chance that this estimate is incorrect, however as the specification for the chips is 1.2 cm, this tells us that the chips being produced do not meet the desired specification.

Since the production team is currently not meeting specifications, the production manager can not justify to the vice president that they are.