Question

External failure costs are costs that: Group of answer choices Result from defects that are discovered during the production of a service or product Result from defects discovered after the customer receives the product or service Incur when the firm assess the performance level of its processes Result from preventing defects before they happen

Answer 1

Answer:

Result from defects discovered after the customer receives the product or service

Explanation:

External failure costs relate to the costs that result from defects that happen during the product's usage in the hands of the customer. Examples of these costs include:

- costs due to product recall

- return operations cost (additional shipping costs)

- lawsuit processes happening after the customer sues the company