A Consumer Product Magazine Recently Ran a Story Concerning the Increasing

question 105

Multiple Choice

A consumer product magazine recently ran a story concerning the increasing prices of digital cameras. The story stated that digital camera prices dipped a couple of years ago, but now are beginning to increase in price because of added features. According to the story, the average price of all digital cameras a couple of years ago was $215.00. A random sample of cameras was recently taken and entered into a spreadsheet. It was desired to test to determine if that average price of all digital cameras is now more than $215.00. The information was entered into a spreadsheet and the following printout was obtained:
One-Sample T Test
Null Hypothesis: $\mu = 215$
Alternative Hyp: $\mu > 215$



Cases Included 22

Use the p-value given above to determine which of the following conclusions is correct.

• A) At \(\alpha = 0.05\), there is insufficient evidence to indicate that the mean price of all digital cameras exceeds \$215.00
• B) At \(\alpha = 0.01\), there is sufficient evidence to indicate that the mean price of all digital cameras exceeds \(\$ 215.00\)
• C) At \(\alpha = 0.03\), there is insufficient evidence to indicate that the mean price of all digital cameras exceeds \(\$ 215.00\)
• D) At \(\alpha = 0.10\), there is insufficient evidence to indicate that the mean price of all digital cameras exceeds \(\$ 215.00\)

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Definitions:

Investment Projects

Initiatives or plans that require capital investment to generate financial returns or achieve business objectives over time.

After-Tax Discount Rate

The discount rate used in capital budgeting that accounts for the effects of taxes on the net present value of a project or investment.

Working Capital

The difference between a company's current assets and current liabilities, indicating the liquidity available for day-to-day operations.

Income Tax Rate

The rate determining the tax payment on the income for individuals and corporations.