Duramold specializes in manufacturing molded plastic panels to be fitted on car doors. The blueprint specification for the thickness of a high-demand model calls for 0.1970 0.0020 inch. It costs $140 to manufacture and $170 to scrap a part that does not meet these specifications. The thickness measure for the unit just completed is 0.1988 inch.

Required:

1. Use the Taguchi quality loss function, L(x), to determine:

a. The value of the cost coefficient, k. (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.)

b. The estimated loss (total quality cost) for the unit just completed, that is, the dollar amount for L(x) where x = 0.1988. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

2. Assume that Duramold can eliminate the uneven thickness by adding a production worker, at the critical production point, for $4.00 per unit. Under this assumption:

a. At what tolerance should the panels be manufactured? (Hint: For this calculation, the total quality cost, L(x), is equal to the above-referenced $4.00 per unit figure.) (Do not round intermediate calculations. Round your answer to 4 decimal places.)

b. What should be the production specification for these panels? That is, what is the upper specification limit and what is the lower specification limit for the quality characteristic? (Do not round intermediate calculations. Round your answers to 4 decimal places.)