A Belt working in a supply chain environment has to make a decision to change suppliers of critical raw materials for a new product upgrade. The purchasing manager is depending on the Belt’s effort requiring that the average cost of an internal critical raw material component be less than or equal to $4,200 in order to stay within budget. Using a sample of 35 first article components, a Mean of the new product upgrade price of $4,060, and a Standard Deviation of $98 was estimated. Select the answer that best states the Practical Problem.
A. If the average cost per component is $4,200 or less, then the purchase manager will introduce the new product upgrade with new components.
B. If the average cost per component is greater than $4,200, then the purchase manager will introduce the new product upgrade with new components.
C. Only if the average cost per product upgrade is $4,060, will the purchase manager introduce new product upgrades with new components.
D. If the average cost per new product upgrade is less than $180, then the purchase manager will introduce the new product upgrade with new components.
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I Think the correct answer is A