A Coffee Shop Franchise Owner Is Looking at Two Possible

question 56

Short Answer

A coffee shop franchise owner is looking at two possible locations for a new shop.To help make a decision,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.Calculate the pooled estimate of σ².

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Definitions:

Reserve Requirement

The Reserve Requirement is a central banking regulation that sets the minimum amount of reserves each bank must hold as a proportion of its deposits, a tool used to control the money supply.

Open Market Operations

Activities by a central bank to buy or sell government securities in the open market to influence the money supply and interest rates.

Reserve Requirement

A regulation set by central banks that specifies the minimum amount of reserves a bank must hold in relation to customer deposits.

Open Market Purchase

A monetary policy tool where the central bank buys government securities from the market in order to expand the money supply.