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Airphone, Inc., manufactures cellular telephones at a processing cost of $57 per unit. The company produces an average of 230 phones per week and has a yield of 89% good-quality phones, resulting in 11% defective phones, all of which can be reworked. The cost of reworking a defective telephone is $15.
a) Compute the QPR.
b) Compute the QPR if the company increased the production rate to 330 phones per week while reducing the processing cost to $45, reducing the rework cost to $10, and increasing the product yield of good-quality telephones to 95%.
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