Ron purchases $32,000 worth of stock on his brokers advice and pays his broker a 1.25% broker fee. How much did he pay his broke
2 answers:
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Answer:
The capability index for the process is 0.889
Step-by-step explanation:
Here, we want to compute the capability index for the process
To get this, we need some important parameters which we already have stated in the question
USL ( upper standard limit) = 0.048
LSL (lower standard limit) = 0.032
mean = 0.04
standard deviation = 0.003
We apply the formula as seen in the attachment below
Kindly understand that we are to calculate the Z upper and Z lower
The smallest value between the two will be our Z minimum
This is what we shall apply in the capability index formula which mathematically is;
Z minimum/3
From calculation:
Z lower = Z upper = 2.67
So therefore;
capability index = 2.67/3 = 0.889
