A quality characteristic has a specification (in cm) of 0.400 ± 0.03 . If the value of the quality characteristic exceeds 0.400 by the tolerance of 0.030 on either side, the product will require a $180.00 repair. What is the appropriate Taguchi loss function?
L(x) = k(x ? T)2
180 = k(0.03)2
k = 200,000
The Taguchi loss function is L(x) = 200,000(x ? 0.400)2.
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