A Major Blu-Ray Rental Chain Is Considering Opening a New

question 108

Multiple Choice

A major Blu-ray rental chain is considering opening a new store in an area that currently does not have any such stores.The chain will open if there is evidence that more than 5,000 of the 20,000 households in the area are equipped with Blu-ray players.It conducts a telephone poll of 300 randomly selected households in the area and finds that 96 have Blu-ray players.The rental chain's conclusion from the hypothesis test using a 5% level of significance is

• A)to open a new store.
• B)not to open a new store.
• C)to delay opening a new store until additional evidence is collected.
• D)We cannot tell what the decision should be from the information given.

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Definitions:

Point Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in its price at a specific point on the demand curve.

Market Supply Curve

A graphical representation showing the total quantity of a particular good or service that producers are willing to sell at various price points.

Rubber Erasers

Small, often rubbery objects used for removing pencil and sometimes ink marks from paper.

Consumer Surplus

The disparity between the total cost consumers are inclined and able to bear for a good or service and the total cost they actually bear.