The Employees at the East Vancouver Office of a Multinational

question 40

Multiple Choice

The employees at the East Vancouver office of a multinational company are demanding higher salaries than those offered at the company office located in Oshawa Ontario. Their justification for the pay difference is that the difference between the average price of single-family houses in East Vancouver and that in Oshawa is more than $60,000. Before making a decision, the company management wants to study the difference in the prices of single-family houses for sale at the two locations.
The results of their search of recent house sales are as follows (in $000, rounded to the nearest thousand) : Assuming that the population distributions are approximately normal, can we conclude at the 0.05 significance level that the difference between the two population means is greater than $60,000? This example is what type of test?

• A) One sample test of means.
• B) Two sample test of means.
• C) Paired t-test.
• D) Test of proportions.
• E) None of these statements are correct

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Definitions:

Employee Time Ticket

A document that records the amount of time an employee spends on various tasks, used for payroll and accounting purposes.

Cost Driver

A factor that influences or contributes to the expense of certain business operations.

Direct Costs

Costs that can be directly attributed to the production of a specific good or service, such as raw materials and direct labor.

Allocation Base

A measure or statistic used to distribute indirect costs to different cost objects, such as departments or products.