Fabricator produces shot gun barrels with outer diameter

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1. A metal fabricator produces shot gun barrels with an outer diameter that has a 3.5 ± 0.05 inch specification. A machine operator takes several sample measurements over time and determines the sample mean outer diameter to be 3.53 inches with a standard deviation of 0.030 inch.

Calculate the process capability index (Round your answer to 4 decimals)

2. A capacity alternative has an initial cost of $50,000 and cash flow of $20,000 for each of the next four years. If the cost of capital is 5 percent, what is the approximate net present value of this investment?

Reference no: EM132234763

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