If There Is a 90 Percent Chance That an Observed

question 19

Essay

If there is a 90 percent chance that an observed variance is random, the cost of conducting an investigation is $1,000, the cost to correct a variance if the investigation reveals a nonrandom cause, and the amount of loss a company expects to incur if it does not investigate a variance that had a nonrandom cause is $30,000, what is the expected cost (to the nearest whole dollar) of not investigating the variance?
A) $30,000.
B) $1,500.
C) $0.
D) $3,900.
E) $3,000.

• A) $30,000.
• B) $1,500.
• C) $0.
• D) $3,900.
• E) $3,000.

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Definitions:

Meninx

The enveloping membrane of the brain and spinal cord; includes dura mater, arachnoid, and pia mater.

Periosteum

Thick, double-layered connective tissue sheath covering the entire surface of a bone, except the articular surface, which is covered with cartilage.

Femoral Nerve

A major nerve in the leg that supplies sensation to the front of the thigh and part of the lower leg as well as motor control to muscles of the leg and hip.

Quadriceps Femoris

A large muscle group that includes four muscles on the front of the thigh, responsible for extending the knee and stabilizing the patella.