(Essay; external failure cost) Many companies’ products have had flaws;

some of these companies have been more forthcoming than others in pub¬ licly acknowledging such flaws.

a. Do you think admitting that a product is defective hurts or helps a com- i pany’s reputation?

b. Discuss the costs and benefits of halting sales when product flaws are discovered.

c. Use the Internet to find an example of a company that has continued to sell its product in spite of complaints and other negative feedback about quality. What have been the results?

■

 LO.1