Suppose That a Group of 100 Consumers Are Asked to Rate

question 12

Multiple Choice

Suppose that a group of 100 consumers are asked to rate how much they liked the taste of a new soft drink on a 5-point scale (where 5 = good taste and 1 = poor taste) . The mean rating was 4.6, with a standard deviation of 1.25. Suppose, further, that the standard error of the mean for this study was 0.15. If you wanted to find the 95 per cent confidence interval (two-tailed test) , and if the Z-value at the .05 level of significance is 1.96, then the confidence interval lies between approximately:

• A) 4.45 and 4.75.
• B) 4.31 and 4.89.
• C) 4.36 and 4.85.
• D) 4.57 and 4.63.

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Definitions:

Payback Period

The duration it takes for an investment to generate an amount of income or cash equivalent to the cost of the investment.

Net Cash Flow

The difference between a company's cash inflows and outflows during a specific period, indicating its liquidity position.

Initial Cost

The amount of money spent to acquire or invest in a significant item, asset, or project at the time of purchase or onset.

Capital Budgeting

The process of planning and evaluating investments in fixed assets and projects with long-term implications for the organization's financial health.