Reliabilities of components differ by supplier


Assignment:

A manufacturer of MP3 players, purchases major electronic components as modules. The reliabilities of components differ by supplier (see diagram, below). Suppose that the configuration of the major components is given by:

2306_Electronic components.jpg

 

The components that can be purchased from three different suppliers. The reliabilities of the components are as follows:

Component   Supplier 1     Supplier 2    Supplier 3

A                  0.95              0.98         0.92

B                  0.95             0.97          0.98

C                  0.99             0.96          0.94

Transportation and purchasing considerations require that only one supplier be chosen. Which one should be selected if the player is to have the highest possible reliability?

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Microeconomics: Reliabilities of components differ by supplier
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