In our discussion of the cost of quality (coq), we note the external costs that occur after delivery of defective products (such as rework, liabilities, lost goodwill, philip crosby, author of quality is free, wrote that the cost of poor quality is understated and "there is absolutely no reason for having errors or defects in any product or service." this new york times article detailing toyota's recently announced recall of 7.4 million vehicles worldwide (including 2.5 million in the u. to repair power-window switches that can break down and start a fire, certainly brings crosby's ideas to the forefront.

2. the language of price controls consider the market for rental cars. suppose that, in a competitive market without government regulations, the equilibrium price of rental cars is $58 per day, and employees at car rental companies earn $19.50 per hour. complete the following table by indicating whether each of the statements is an example of a price ceiling or a price floor and whether it results in a shortage or a surplus or has no effect on the price and quantity that prevail in the market. statement price control effect there are many teenagers who would like to work at car rental companies, but the minimum-wage law sets the hourly wage at $23.00. the government has instituted a legal minimum price of $87 per day for rental cars. the government prohibits car rental companies from renting out rental cars for more than $87 per day.