Phillip Crosby asserts that quality is free. Is he right?
What will be an ideal response?
No, if taken literally, quality is not free. Management has to take a lot of time and put in a lot of money to ensure quality is maintained. Is this worth it? Crosby would say yes under all circumstances. However, this is not really true - it depends on whether an additional dollar spent on monitoring quality adds an additional dollar of value to the firm. What if it does not? Crosby would still recommend that action. However, it will have to come at the cost of economic value, and that is still a cost.
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Because minimum wage is a price floor
A) it will maximize consumer surplus. B) it will create a deadweight loss. C) it will be set below the market equilibrium price. D) it will increase the number of jobs available in the labor market.
The type of regulation that attempts to keep prices and the rate of return in an industry at a competitive level is referred to as
A) cost-of-service regulation. B) rate-of-return regulation. C) service-opportunity regulation. D) natural regulation.
Wars of attrition arise in which of the following contexts?
A) fiscal policy B) deficit reduction C) hyperinflation D) all of above E) A and B
If two goods are substitutes, then
A) an increase in the price of one causes the demand for the other to fall. B) there is an inverse relationship between changes in the price of one good and changes in the demand for the other. C) if the price of one good falls, the demand for the other good falls also. D) changes in the quantity demanded of one good will not affect the demand for the other.