The Manager of the Marketing Division of Acme Corporation Forecasts $\mu$

question 6

Multiple Choice

The manager of the marketing division of Acme Corporation forecasts an average monthly sales in 1978 of $65,000.In the first seven months of 1978, the average monthly sales were $63,200, with a standard deviation of $500.The management wishes to test the hypothesis H_o that "statistically" the manager was right H_o: $\mu$ = 65,000) against the alternative hypothesis that he was wrong in his forecast H_o: $\mu$ = 65,000) , using a two-tail test.Assuming normal distribution of monthly sales, which of the following statements is true?

• A)H_o is rejected at the 5 percent significance level but accepted at the 1 percent significance level.
• B)H_o is accepted at both the 5 percent and 1 percent significance levels.
• C)H_o is accepted at the 5 percent significance level but rejected at the 1 percent significance level.
• D)H_o is rejected at both the 5 percent and 1 percent significance levels.
• E)None of the above.

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Definitions:

Note Receivable

A financial asset representing a promise to pay a specific amount of money, plus interest if applicable, by a certain date or dates.

T-account

A T-account is a visual representation of a general ledger account that outlines a business's debits and credits.

Unearned Revenues

Income received by a company for goods or services that have yet to be delivered or performed.

Source Documents

Original records that provide evidence and details of business transactions, such as receipts and invoices.