What is a common consequence of internal failure costs?

Internal failure costs arise from defects found before a product is delivered to customers. These costs typically include expenses related to rework, scrap, and the resources needed to investigate and correct defects.

When defects are identified internally, manufacturers must often invest time and materials to rectify these issues. This can lead to increased rework and the production of scrap—materials that cannot be salvaged or sold, representing a loss for the company.

The focus of internal failure costs is on mitigating the impact of defects before they escalate into external failures, which could harm customer satisfaction and the company's reputation. Hence, the nature of internal failure costs is directly tied to the need for product rework and managing scrap, making this the correct response.