Economic Design of Moving Average Control Chart for Continued and Ceased Production Process

In this article following the approach of Lorenzen and Vance, an economic design of moving average control chart is developed for ceased as well for continued production during control actions. The performance of the control charts is compared for the two production modes by means of the loss cost per time unit. The ceased production mode yields about 30% saving in the loss cost when compared to that of the continued production. The example given provides some insight to the sensitivity of the model.