SCENARIO 4-12 A Consulting Firm That Surveyed Consumers' Holiday Shopping Behavior Found

question 55

Short Answer

SCENARIO 4-12
A consulting firm that surveyed consumers' holiday shopping behavior found that the percentage of
consumers from the U.S., Canada, and China who said that they planned to spend more on holiday
shopping were 40%, 34% and 73%, respectively. The survey also found that the percentage of
consumers from the U.S., Canada, and China who said that they were willing to share personal
information with retailers in order to receive personalized offers from retailers were 55%, 46% and
72%, respectively. Assume that there are equal portions of consumers being surveyed from each of
the three countries, the survey results are good representations of the three populations of consumers,
and whether a consumer plans to spend more on holiday shopping is statistically independent of
whether he/she is willing to share personal information with retailers in order to receive personalized
offers from retailers.
-Referring to Scenario 4-12, if you randomly select a consumer from any of the three countries,
what is the probability that the consumer is from the U.S. or China who does not plan to spend
more on holiday shopping and is not willing to share personal information with retailers in order
to receive personalized offers from retailers?

---

Definitions:

Step-Down Method

An accounting method used in cost allocation that sequentially allocates service department costs to other departments, including production ones.

Support Department

A division within an organization that provides essential services or support to the primary operations or profit centers.

Finishing Department

The section in manufacturing where products undergo final processing, assembly, or completion.

Cost Allocated

The distribution of indirect costs to different cost objects, to fairly attribute overhead expenses to products or services.