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Suppose That xx Is a Normally Distributed Variable on Each of Two Populations

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Suppose that xx is a normally distributed variable on each of two populations. Independent samples of sizes n1n _ { 1 } and n2n _ { 2 } , respectively, are selected from the two populations.The standard deviation of all possible differences between the two sample means equals the square root of the difference of the population variances each divided by the corresponding sample size.


Definitions:

Materials Price Variance

The difference between the actual cost of materials and the standard cost multiplied by the quantities purchased.

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the expected quantity, based on the standard cost.

Materials Quantity Variance

The discrepancy between the actual use of materials in production and the planned use, each multiplied by the predetermined cost per unit.

Variable Overhead

Indirect manufacturing costs that vary with the level of production activity, such as utilities for the manufacturing plant.

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