A Truck Company Wants On-Time Delivery For $98 \%$ Of the Parts They Order from a Metal Manufacturing Plant

question 12

Multiple Choice

A truck company wants on-time delivery for $98 \%$ of the parts they order from a metal manufacturing plant. They have been ordering from Hudson Manufacturing but will switch to a new, cheaper manufacturer (Steel-R-Us) unless there is evidence that this new manufacturer cannot meet the $98 \%$ on-time goal. As a test the truck company purchases a random sample of metal parts from Steel-R-Us, and then determines if these parts were delivered on-time. Which hypothesis should they test?

• A) \(\mathrm { H } _ { 0 } : p = 0.98\)
• \[\mathrm { H } _ { \mathrm { A } } : p \neq 0.98\]
• B) \(\mathrm { H } _ { 0 } : p > 0.98\)
• \[\mathrm { H } _ { \mathrm { A } } : p = 0.98\]
• C) \(\mathrm { H } _ { 0 } : p = 0.98\)
• \[\mathrm { H } _ { \mathrm { A } } : p > 0.98\]
• D) \(\mathrm { H } _ { 0 } : p = 0.98\)
• \[\mathrm { H } _ { \mathrm { A } } : p < 0.98\]
• E) \(\mathrm { H } _ { 0 } : p < 0.98\)
• \[\mathrm { H } _ { \mathrm { A } } : p > 0.98\]

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Definitions:

Deferred Tax Liability

A tax obligation that arises when taxable income and accounting income differ, to be paid in future reporting periods.

Amortization

The process of gradually writing off the initial cost of an asset over a period. It's often used in the context of loan repayments or spreading the cost of an intangible asset over its useful life.

Accounts Payable

The amount a company owes to suppliers or vendors for goods or services received that have not yet been paid for.

Financial Statements

Documents that provide an overview of a company's financial condition, including balance sheet, income statement, and cash flow statement.