The Management of a Department Store Is Interested in Estimating

question 84

Multiple Choice

The management of a department store is interested in estimating the difference between the mean credit purchases of customers using the store's credit card versus those customers using a national major credit card.You are given the following information. ​ At 95% confidence, the margin of error is

• A) 1.694.
• B) 3.32.
• C) 1.96.
• D) 15.

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Definitions:

Contribution Margin Ratio

The percentage of each sale that contributes to covering fixed costs, calculated as (Sales - Variable Costs) / Sales.

Margin of Safety

The difference between actual sales and the break-even point, measuring the risk of not covering fixed costs.

Pre-tax Income

The amount of income earned by an individual or company before any taxes have been deducted.

Variable Costs

Costs that vary directly with the level of production or service activity, such as raw materials and labor hours.