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CAT 1991 — QA Question 8

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Passage / Data

Use the following information:

Prakash has to decide whether or not to test a batch of 1000 widgets before sending them to the buyer. In case he decides to test, he has two options: (a) Use test I ; (b) Use test II. Test I cost Rs. 2 per widget. However, the test is not perfect. It sends 20% of the bad ones to the buyer as good. Test II costs Rs. 3 per widget. It brings out all the bad ones. A defective widget identified before sending can be corrected at a cost of Rs. 25 per widget. All defective widgets are identified at the buyer’s end and penalty of Rs. 50 per defective widget has to be paid by Prakash.

 If the number of defective widgets in the lot is between 200 and 400, Prakash:

Answer & solution

Correct answer: should use Test II only

  • A

    may use Test I or Test II

  • B

    should use Test I only

  • should use Test II only

  • D

    cannot decide

Solution

Consider the solution to first question of this set.

For widgets ≤ 100, no test is required.
For 100 ≥ widgets ≤ 200 test 1 is preferred.
For widgets ≥ 200 test 2 is preferred.

Hence, option (c).

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CAT 1991 QA Q8: If the number of defective widgets in the lot is between 200 and 400, Prakash: — Solution | TheCATExam