TABLE 9-3 An Appliance Manufacturer Claims to Have Developed a Compact Microwave

question 132

True/False

TABLE 9-3
An appliance manufacturer claims to have developed a compact microwave oven that consumes a mean of no more than 250 W.From previous studies,it is believed that power consumption for microwave ovens is normally distributed with a population standard deviation of 15 W.A consumer group has decided to try to discover if the claim appears true.They take a sample of 20 microwave ovens and find that they consume a mean of 257.3 W.
-True or False: Referring to Table 9-3,the consumer group can conclude that there is enough evidence that the manufacturer's claim is not true when allowing for a 5% probability of committing a Type I error.

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Definitions:

Flexible Budget

A budget that adjusts or flexes with changes in the volume or activity level of a business.

Overhead Volume Variance

The difference between the budgeted and actual overhead costs, attributable to variations in production volume.

Fixed Overhead Items

Costs that do not change with the level of production or sales over a certain range, such as rent, salaries, and insurance.