The AOQ is often lower for a supplier with a high fraction defective than for a supplier with a comparatively lower fraction defective. Why wouldn't a supplier with a lower fraction defective always have a better AOQ?
What will be an ideal response?
Average outgoing quality is based on the probability of accepting a lot with a certain fraction defective, given a sample (and lot) size. If a supplier has a very small fraction defective, it is unlikely that the inspection sample contains any defectives, so the lot will be accepted. A supplier with a much higher fraction defective will produce lots that trigger 100% inspection, resulting in more defective product being weeded out and a better AOQ.
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