The Next Questions Are Based on the Following Information

question 74

Multiple Choice

The Next Questions Are Based On The Following Information:
The manufacturer of a new chewing gum claims that at least 80% of dentists surveyed prefer their type of gum and recommend it for their patients who chew gum.An independent consumer research firm decides to test their claim.The findings in a sample of 200 dentists indicate that 74.1% of the respondents do actually prefer their gum.
-What is the decision rule?

• A)Reject H₀ if ( - P₀)/ > z_α/2
• B)Reject H₀ if ( - P₀)/ > z_α
• C)Reject H₀ if ( - P₀)/ < -z_α/2
• D)Reject H₀ if ( - P₀)/ < -z_α

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Definitions:

Price Skimming Strategy

A price skimming strategy involves setting high prices initially and then gradually lowering them to attract more price-sensitive customers.

Product Innovation

The development of new or significantly improved goods or services that deliver value to customers and differentiate a company from its competitors.

Target Return

Is a pricing strategy aimed at achieving a specific return on investment or sales volume goals.

Maximizing Profits

A profit strategy that relies primarily on economic theory. If a firm can accurately specify a mathematical model that captures all the factors required to explain and predict sales and profits, it should be able to identify the price at which its profits are maximized.