Indifference Contracting for Reliability Utilizing the Exponential Distribution

摘要

The paper presents a new combination of reliability life testing and contracting program which involves the awarding of bid based directly on the life cycle cost of the item, no rejection of the submitted product, and a payment plan based directly on the reliability performance of the item in the field. With the establishment of the contracting plan, the consumer is rendered indifferent to the reliability of the submitted product through the knowledge that the established contract plan will assume the burden of the evaluation of the reliability, not the consumer. (Author)