Determination of Measurement Limits to Optimize Production Losses

The dollar consequence functions associated with consumer's and producer's risks are developed and optimized through use of computer technology. The bivariate normal distribution is used to compute the probabilities resulting from establishment of test limits inside or outside of specffication limits after the manner of Grubbs and Coon [1] and Eagle [2]. Methods of application and precautions during use are described. Practical limits on parameters are discussed, but these are shown to exert no mathematical restrictions on the solutions presented.