Suppose You Hypothesized That the Average Salary in the Company

question 28

Multiple Choice

Suppose you hypothesized that the average salary in the company is $75,000. You then collect a sample of salaries for employees of the company. Using statistical theory, you know that, if the average salary is $75,000, then the probability that your sample average is above $90,000 or below $60,000 is 0.05. If you observe an average salary of $91,000:

• A) you make the inductive argument that the probability that your sample average is above $90,000 or below $60,000 is not 0.05. The strength of this argument is 5%.
• B) you make the deductive argument that the probability that your sample average is above $90,000 or below $60,000 is not 0.05. The strength of this argument is 95%.
• C) you make the inductive argument that the average salary in the company is not $75,000. The strength of this argument is 95%.
• D) None of the answers is correct.

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Definitions:

Product F

A specific item or good produced by a company, referred to as "Product F" for identification or category purposes.

Activity Rates

These are the costs assigned to work based on the activities required to complete a job or task.

Batches

Groups of items or goods processed or produced together within a specified time frame in manufacturing or production.

Product Margins

The difference between the selling price of a product and the cost of goods sold, representing the profit made on each product.