Concept explainers
PortaCom has developed a design for a high-quality portable printer. The two key components of manufacturing cost are direct labor and parts. During a testing period, the company has developed prototypes and conducted extensive product tests with the new printer. PortaCom’s engineers have developed the bivariate
Parts (x) | Direct Labor (y) 43 45 48 |
Total | ||
85 | 0.05 | 0.2 | 0.2 | 0.45 |
95 | 0.25 | 0.2 | 0.1 | 0.55 |
Total | 0.30 | 0.4 | 0.3 | 1.00 |
- a. Show the marginal distribution of direct labor cost and compute its
expected value , variance, and standard deviation. - b. Show the marginal distribution of parts cost and compute its expected value, variance, and standard deviation.
- c. Total manufacturing cost per unit is the sum of direct labor cost and parts cost. Show the probability distribution for total manufacturing cost per unit.
- d. Compute the expected value, variance, and standard deviation of total manufacturing cost per unit.
- e. Are direct labor and parts costs independent? Why or why not? If you conclude that they are not, what is the relationship between direct labor and parts cost?
- f. PortaCom produced 1500 printers for its product introduction. The total manufacturing cost was $198,350. Is that about what you would expect? If it is higher or lower, what do you think may have caused it?
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Modern Business Statistics with Microsoft Office Excel (with XLSTAT Education Edition Printed Access Card) (MindTap Course List)
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