Concerning the Sampling Distribution of , What Is the Significance

question 29

Multiple Choice

Concerning the sampling distribution of , what is the significance of the conditions np ≥ 5 and n(1 - p) ≥ 5?

• A) It is impossible to make any inference on p using unless both these conditions are met.
• B) The sampling distribution of will be approximately normal if both these conditions are met.
• C) It is possible to use to estimate p only if one of these conditions is met.
• D) The value of will be very close to p if and only if the sample size is large enough for both these conditions to be met.

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Definitions:

Direct Labor

The labor costs that can be directly attributed to the production of goods or services, such as wages for workers who manufacture a product.

Work in Process

Inventory that includes goods partially through the manufacturing process but not yet completed.

Budgeted Fixed Manufacturing Overhead

This term refers to the projected fixed costs associated with the production process, including expenses that do not change with the level of production.

Standard Fixed Manufacturing Overhead Rate

A predetermined rate used in costing to allocate the estimated fixed manufacturing overhead costs to individual units of production based on a consistent activity base, such as machine hours or labor hours.