You Having Two Employees Working on Commission - Employee a and Employee

question 22

Multiple Choice

You having two employees working on commission - employee A and employee B. Over the course of 80 weeks, you observe the sales of each employee. Let X = the number of times employee A has more sales than employee B. You build the following line of reasoning:
Steps
1) You assume each sales observation is an independent, random outcome.
2) You assume each employee has equal likelihood of have greater sales in a week.
3) Using your statistics book, you conclude that X is distributed binomial with mean 40 and variance 20.
4) Based on this distribution, you conclude that you would observe X < 32 or X > 48 approximately 5% of the time.
5) You observe X = 53 and conclude that the probability that X < 32 or X > 48 is not 5%.
6) Because the probability that X < 32 or X > 48 is not 5%, you conclude employee A and employee B do not have equal likelihood of having greater sales in a week.
Which of these steps is part of deductive reasoning?

• A) Steps 1, 2, 3, and 4 only
• B) Steps 1, 2, 3, 4, and 6 only
• C) All 6 steps
• D) Steps 3, 4, and 5 only

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Definitions:

Life Cycle Cost

The total cost of ownership of a product or system over its entire life, including initial purchase, operation, maintenance, and disposal costs.

Operating Cost

The total amount of money required to run a business, project, or device, excluding capital expenditures.

External Cost

Costs of a transaction that affect people other than the buyer or seller, which are not reflected in market prices.

Commercial Energy

Energy derived from commercial sources such as fossil fuels, intended primarily for businesses and manufacturing.