A Coffee Shop Franchise Owner Is Looking at Two Possible

question 110

Short Answer

A coffee shop franchise owner is looking at two possible locations for a new shop.To help him decide,he looks at the number of pedestrians that go by each of the two locations in one-hour segments.At location A,counts are taken for 35 one-hour units,with a mean number of pedestrians of 421 and a sample standard deviation of 122.At the second location (B),counts are taken for 50 one-hour units,with a mean number of pedestrians of 347 and a sample standard deviation of 85.Assume the two population variances are not known but are equal.Set up the null hypothesis to test the claim that both sites have the same number of pedestrians.

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Definitions:

Fixed Manufacturing Overhead Budget Variance

The discrepancy between the budgeted fixed overhead costs and the actual fixed overhead incurred during production.

Fixed Manufacturing Overhead Volume Variance

The difference between the budgeted and actually applied fixed manufacturing overhead, based on standard costs for a given period.

Fixed Overhead Budget Variance

The difference between actual fixed overhead costs and the budgeted or expected fixed overhead costs.

Volume Variance

A measure of the difference between the budgeted and actual volume of production, impacting costs.