SCENARIO 9-4 A Drug Company Is Considering Marketing a New Local Anesthetic.The

question 146

True/False

SCENARIO 9-4
A drug company is considering marketing a new local anesthetic.The effective time of the anesthetic the drug company is currently producing has a normal distribution with an mean of
7.4 minutes with a standard deviation of 1.2 minutes.The chemistry of the new anesthetic is such that the effective time should be normally distributed with the same standard deviation,but the mean effective time may be lower.If it is lower,the drug company will market the new anesthetic;otherwise,they will continue to produce the older one.A sample of size 36 results in a sample mean of 7.1.A hypothesis test will be done to help make the decision.
-Referring to Scenario 9-4,if the level of significance had been chosen as 0.05,the company would market the new anesthetic.

---

Definitions:

Inflation Rate

The speed at which the average cost of products and services increases, reducing the buying power.

Risk Averse

A tendency to prefer options that have fewer risks and more certain outcomes.

Net Earnings

The profit (or loss) of a business after all expenses have been deducted from revenues.

Probability

A measure of the likelihood that an event will occur, often expressed as a number between 0 and 1.