Practice Quiz

Lean Bronze

Category - Continuous Improvement

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Which of these choices is an example of an external cost related to an improvement?
  1. A shift leader realizes they are short 130 cases of product for their shift.
  2. A lot number of books has to be retested for ink alignment.
  3. Environmental costs for environmental cleanup or abatement.
  4. A robotic arm which lifts assembly line automobiles is out of service.
Explanation
Answer: C - Environmental costs for environmental cleanup or abatement would be an example of an external cost related to an improvement. The three types of costs associated with an improvement are internal, external, and prevention. The cost of poor quality is measured differently depending on the industry. Some companies will relate the cost of quality as a percentage of total sales.
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