Airphone, Inc., manufactures cellular telephones at a processing cost of $81 per unit. The company produces an average of 250 phones per week and has a yield of 80% good-quality phones, resulting in 20% defective phones, 55% of which can be reworked. The cost of reworking a defective telephone is $21.
What is the quality-productivity ratio (QPR)?
Evaluate the effect of the following changes on QPR. Make all changes in the original problem.
1. Compute the QPR if the company increased the production rate to 320 phones per week.
2. Compute the QPR if processing cost is reduced to $75 and rework cost is reduced to $17.
3. Compute the QPR if good quality telephones is increased to 81%.
4. Compute the QPR if % reworked is reduced to 28.5%.