Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN: 9781305627734

Author: Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher: Cengage Learning

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Textbook Question

Chapter 6, Problem 30P

Suppose a new production method will be implemented if a hypothesis test supports the conclusion that the new method reduces the mean operating cost per hour.

a. State the appropriate null and alternative hypotheses if the mean cost for the current production method is $220 per hour.
b. What is the Type I error in this situation? What are the consequences of making this error?
c. What is the Type II error in this situation? What are the consequences of making this error?

Definition Definition Measure of central tendency that is the average of a given data set. The mean value is evaluated as the quotient of the sum of all observations by the sample size. The mean, in contrast to a median, is affected by extreme values. Very large or very small values can distract the mean from the center of the data. Arithmetic mean: The most common type of mean is the arithmetic mean. It is evaluated using the formula: μ = 1 N ∑ i = 1 N x i Other types of means are the geometric mean, logarithmic mean, and harmonic mean. Geometric mean: The nth root of the product of n observations from a data set is defined as the geometric mean of the set: G = x 1 x 2 ... x n n Logarithmic mean: The difference of the natural logarithms of the two numbers, divided by the difference between the numbers is the logarithmic mean of the two numbers. The logarithmic mean is used particularly in heat transfer and mass transfer. ln x 2 − ln x 1 x 2 − x 1 Harmonic mean: The inverse of the arithmetic mean of the inverses of all the numbers in a data set is the harmonic mean of the data. 1 1 x 1 + 1 x 2 + ...

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Chapter 6, Problem 29P

Chapter 6, Problem 31P

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Suppose a new production method will be implemented if a hypothesis test supports theconclusion that the new method reduces the mean operating cost per hour.a. State the appropriate null and alternative hypotheses if the mean cost for the currentproduction method is $220 per hour.b. what is the type i error in this situation? what are the consequences of making this error?c. what is the type ii error in this situation? what are the consequences of making this error?

Suppose a new production method will be implemented if a hypothesis test supports the conclusion that the new method reduces the mean operating cost per hour. #1 State the appropriate null and alternative hypotheses if the mean cost for the current production method is $280 per hour. A) H0: ? ≤ 280 Ha: ? > 280 B) H0: ? = 280 Ha: ? ≠ 280 C) H0: ? < 280 Ha: ? ≥ 280 D) H0: ? > 280 Ha: ? ≤ 280 E) H0: ? ≥ 280 Ha: ? < 280 #2 What is the type I error in this situation? What are the consequences of making this error? A) It would be claiming ? ≤ 280 when the new method does not lower costs. This mistake could result in implementing the method when it would not lower costs. B)It would be claiming ? < 280 when the new method does not lower costs. This mistake could result in implementing the method when it would not lower costs. C) It would be claiming ? ≥ 280 when the method really would lower costs. This mistake could result in not implementing a method…

In the past, the mean running time for a certain type of flashlight battery has been 9.6 hours. The manufacturer has introduced a change in the production method and wants to perform a hypothesis test to determine whether the mean running time has decreased as a result. A hypothesis test is to be performed. Determine the null and alternative hypotheses. A. H0: µ ¥ 9.6 hours and H1: µ = 9.6 hours B. H0: µ = 9.6 hours and H1: µ ¥ 9.6 hours C. H0: µ = 9.6 hours and H1: µ > 9.6 hours D. H0: µ = 9.6 hours and H1: µ < 9.6 hours

Chapter 6 Solutions

Essentials of Business Analytics (MindTap Course List)

Ch. 6 - The American League consists of 15 baseball teams....Ch. 6 - The U.S. Golf Association is considering a ban on...Ch. 6 - A simple random sample of 5 months of sales data...Ch. 6 - Morningstar publishes ratings data on 1,208...Ch. 6 - One of the questions in the Pew Internet &...Ch. 6 - In this chapter we showed how a simple random...Ch. 6 - The College Board reported the following mean...Ch. 6 - Prob. 8P Ch. 6 - The Economic Policy Institute periodically issues...Ch. 6 - The state of California has a mean annual rainfall...

Ch. 6 - The president of Doerman Distributors, Inc.,...Ch. 6 - Prob. 12P Ch. 6 - People end up tossing 12% of what they buy at the...Ch. 6 - Prob. 14P Ch. 6 - The International Air Transport Association...Ch. 6 - Prob. 16P Ch. 6 - Health insurers are beginning to offer...Ch. 6 - The average annual premium for automobile...Ch. 6 - Prob. 19P Ch. 6 - According to Thomson Financial, last year the...Ch. 6 - The Pew Research Center Internet Project conducted...Ch. 6 - For many years businesses have struggled with the...Ch. 6 - The manager of the Danvers-Hilton Resort Hotel...Ch. 6 - The manager of an automobile dealership is...Ch. 6 - A production line operation is designed to fill...Ch. 6 - Because of high production-changeover time and...Ch. 6 - Duke Energy reported that the cost of electricity...Ch. 6 - Prob. 28P Ch. 6 - Carpetland salespersons average 8,000 per week in...Ch. 6 - Suppose a new production method will be...Ch. 6 - Prob. 31P Ch. 6 - A shareholders’ group, in lodging a protest,...Ch. 6 - Prob. 33P Ch. 6 - Prob. 34P Ch. 6 - Prob. 35P Ch. 6 - According to the National Automobile Dealers...Ch. 6 - What percentage of the population live in their...Ch. 6 - Prob. 38P Ch. 6 - Ten years ago 53% of American families owned...Ch. 6 - Prob. 40P Ch. 6 - Prob. 41P Ch. 6 - Prob. 42P Ch. 6 - The Port Authority sells a wide variety of cables...Ch. 6 - The Port Authority also wants to determine if the...Ch. 6 - Prob. 1C

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Because of high production-changeover time and costs, a director of manufacturing must convince management that a proposed manufacturing method reduces costs before the new method can be implemented. The current production method operates with a mean cost of $260 per hour. A research study will measure the cost of the new method over a sample production period. (a) Develop the null and alternative hypotheses most appropriate for this study. H0: ? < 260 Ha: ? ≥ 260 H0: ? > 260 Ha: ? ≤ 260 H0: ? ≤ 260 Ha: ? > 260 H0: ? = 260 Ha: ? ≠ 260 H0: ? ≥ 260 Ha: ? < 260 (b) Comment on the conclusion when H0 cannot be rejected. There is not enough evidence to conclude that the new method reduces costs. Management should consider implementing the new method.There is enough evidence to conclude that the new method reduces costs. Management should not consider implementing the new method. There is enough evidence to conclude that the new method reduces costs. Management…
"In your response indicate whether CPAs in states that have flat state income tax rates work fewer hours per week during tax season compared to the US average. You will want to formally set up H0 and Ha, report either the test statistic (z-value) or p-value, and explain why you either reject or fail to reject your null hypothesis."
Indicate whether CPAs in states that have flat state income tax rates work fewer hours per week during tax season compared to the US average. You will want to formally set up H0 and Ha, report either the test statistic (z-value) or p-value, and explain why you either reject or fail to reject your null hypothesis.

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Hypothesis Testing using Confidence Interval Approach; Author: BUM2413 Applied Statistics UMP;https://www.youtube.com/watch?v=Hq1l3e9pLyY;License: Standard YouTube License, CC-BY

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Solution Summary: The author explains the null and alternative hypothesis, and identifies the Type I and Type II errors.

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Chapter 6 Solutions