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This paper provides a general approach for determining tolerances for machined parts which minimizes the combined machining cost and quality cost. We derive a mathematical model which takes into consideration both machining cost and quality cost, which depend on tolerance specifications and the distribution of the machined part dimension produced by a chosen machining process. The model represents the quality cost with a loss function and represents the machining cost with a fitted curve based on some original data. The distribution of the machined part characteristic is taken to be either normal or triangular, depending on model assumptions. By applying this model, designers can determine the tolerance which provides the minimum expected total cost.
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Angus Jeang (1994) studied this question.
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