The Overnight Shipping Business Has Skyrocketed in the Last Ten

question 182

Multiple Choice

The overnight shipping business has skyrocketed in the last ten years. The single greatest predictor of acompanyʹs success has been proven time and again to be customer service. A study was conducted to study thecustomer satisfaction levels for one overnight shipping business. In addition to the customerʹs satisfaction level,the customers were asked how often they used overnight shipping. The results are shown below in thefollowing table. What is the probability that a respondent did not have a high level of satisfaction with thecompany? Round the the nearest hundredth. $$\begin{array} { c | c c c | c } & { \text { Satisfaction level } } & \\\text { Frequency of Use } & \text { High } & \text { Medium } & \text { Low } & \text { TOTAL } \\\hline < 2 \text { per month } & 250 & 140 & 10 & 400 \\2 - 5 \text { per month } & 140 & 55 & 5 & 200 \\> 5 \text { per month } & 70 & 25 & 5 & 100 \\\hline \text { TOTAL } & 460 & 220 & 20 & 700\end{array}$$

• A) 0.34
• B) 0.66
• C) 0.57
• D) 0.43

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Definitions:

Capital Budgeting

The process of evaluating and selecting long-term investments that are in line with the goal of maximizing shareholder wealth.

Investments

Assets or items acquired with the goal of generating income or appreciation in value over time.

Net Present Value

A valuation method that calculates the present value of future cash flows generated by an investment, minus the initial investment cost.

Cash Flows

The movement of money into and out of a business, project, or financial product, considered essential for assessing the health and sustainability of an entity.