The Oxnard Retailers Anti-Theft Alliance (ORATA) Published a Study That

question 64

Multiple Choice

The Oxnard Retailers Anti-Theft Alliance (ORATA) published a study that claimed the causes of disappearance of inventory in retail stores were 30 percent shoplifting, 50 percent employee theft, and 20 percent faulty paperwork. The manager of the Melodic Kortholt Outlet performed an audit of the disappearance of 80 items and found the frequencies shown below. She would like to know if her store's experience follows the same pattern as other retailers. $$\begin{array} { | l | c | c | c | } \hline \text { Reason } & \text { Shoplifting } & \text { Employee Theft } & \text { Poor Paperwork } \\\hline \text { Frequency } & 32 & 38 & 10 \\\hline\end{array}$$ The value of the chi-square test statistic you would use in testing whether there is a difference from the published pattern is:

• A)7.54.
• B)5.02.
• C)9.76.
• D)9.22.

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Definitions:

Operating Leverage

This is a measure of how revenue growth translates into growth in operating income, showing the proportion of fixed costs in a company's cost structure.

Financial Leverage

Financial leverage refers to the use of borrowed funds to increase the potential return on investment, amplifying both potential gains and losses.

Technological Advantages

Benefits a company gains by utilizing superior technology compared to its competitors, potentially leading to higher efficiency and profit margins.

Equity Account

An account that represents the ownership interest of shareholders in a corporation, reflected in common and preferred shares.