Suppose a Large Labor Union Wishes to Estimate the Mean

question 72

Multiple Choice

Suppose a large labor union wishes to estimate the mean number of hours per month a union member is absent from work. The union decides to sample 468 of its members at random and monitor the working time of each of them for 1 month. At the end of the month, the total number of hours absent from work is recorded for each employee. Which of the following should be used to estimate the parameter of interest for this problem?

• A) A small sample confidence interval for µ.
• B) A large sample confidence interval for p.
• C) A small sample confidence interval for p.
• D) A large sample confidence interval for µ.

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Definitions:

Net Present Value

A financial metric that estimates the profitability of an investment or project by calculating the difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Internal Rate of Return

This is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Payback Period

The length of time it takes for an investment to recover its initial expenditure from the cash inflows that it generates.

After-Tax Discount Rate

The rate used to discount future cash flows to their present value, adjusted for the impact of taxes.