Test Hypotheses Regarding Two Population Standard Deviations
-A Local Restaurant $\alpha = 0.05$

question 112

Short Answer

Test Hypotheses Regarding Two Population Standard Deviations
-A local restaurant claims that the variance of waiting time for its patrons to be served is the lowest in the area. A competitor restaurant checks the waiting time at both restaurants. The sample statistics are listed below. Test the local restaurant's hypothesis. Use $\alpha = 0.05$ .
$$\begin{array} { l l } \text { Local Restaurant } & \text { Competitor Restaurant } \\\mathrm { n } _ { 1 } = 41 & \mathrm { n } _ { 2 } = 61 \\\mathrm {~s} _ { 1 } = 1.1 \text { minutes } & \mathrm { s } _ { 2 } = 2 \text { minutes }\end{array}$$
Assume the samples were randomly selected from normal populations.

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Definitions:

Break-Even Point in Units

The point at which sales volumes result in no profit or loss, calculated by dividing fixed costs by the contribution margin per unit.

Unit Fixed Cost

The fixed cost associated with manufacturing one unit of a product, which remains constant regardless of the number of units produced.

Unit Variable Cost

The variable cost associated with producing one unit of product, including materials, labor, and other costs that vary with production volume.

Variable Costing

A bookkeeping approach that incorporates solely variable production expenses such as direct materials, direct labor, and variable manufacturing overhead into the costs of products, while omitting fixed overhead.