The University Police Department Must Write, on Average, Five Tickets

question 67

Multiple Choice

The university police department must write, on average, five tickets per day to keep department revenues at budgeted levels. Suppose the number of tickets written per day follows a Poisson
Distribution with a mean of 8.5. Interpret the value of the mean.

• A)The mean has no interpretation since 0.5 ticket can never be written.
• B)On half of the days less than 8.5 tickets are written and on half of the days have more than 8.5 tickets are written.
• C)The number of tickets that is written most often is 8.5 tickets per day.
• D)If we sampled all days, the arithmetic average number of tickets written would be 8.5 tickets per day.

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Definitions:

Production Costs

The total expenses associated with manufacturing a product, including raw material, labor, and overhead costs.

Equivalent Units

A concept in cost accounting used to assign costs to partially completed goods, measured in terms of complete units of output.

First-In, First-Out

An inventory valuation method where the costs of the earliest goods purchased are the first to be recognized in determining cost of goods sold.

Equivalent Units

A concept used in cost accounting to convert partially completed goods into a number of fully completed units for inventory and cost calculations.