Question
A manufacturing company has been working with one of its primary suppliers to improve the quality of raw materials it purchases from the supplier. If
A manufacturing company has been working with one of its primary suppliers to improve the quality of raw materials it purchases from the supplier. If the theory behind cost of quality (COQ) holds true, what would be expected to happen?
a) The increase in upstream spending will be more than offset by decreases in downstream testing and failure costs.
b) Detection costs will decrease because of increased spending on appraisal costs.
c) The companys focus on quality control rather than quality assurance will result in an overall decrease in quality costs.
d) The suppliers costs would be transferred to the manufacturing company, but this would reduce the combined quality costs of the two companies.
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