Cost Management 6th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins

Exercise 48

Assume that a plasma TV company is working at a three-sigma level of quality in terms of each of 100 component parts in each TV it manufactures. Because of the high price associated with these TV sets, the company defines a product defect as any unit with one or more defective components. (That is, a good-quality output is defined as a TV set with zero defective parts.) On average, what is the probability of producing a unit with zero defects (Show calculations.)