Carlson Manufacturing Is a Producer of Plastic Bottles for Bottled

Essay

Carlson Manufacturing is a producer of plastic bottles for bottled water companies. In July of this year, the plant manager switched to a new supplier of raw materials. The materials have a lower cost, and because of their chemical composition, more bottles can be made per hour. The downside of this faster production is that more bad, unusable bottles result. Below are the production data for the two months before and after the switch of suppliers.

a. Compute bad units as a percentage of total production for each month. Round answers to two decimal places.
b. What does the plant manager need to consider in determining whether or not to continue buying raw material from the new supplier?