The Manager of a Local Specialty Store Is Concerned with a Possible

question 141

Essay

The manager of a local specialty store is concerned with a possible slowdown in payments by her customers.She measures the rate of payment in terms of the average number of days receivables are outstanding.Generally,the store has maintained an average of 50 days with a standard deviation of 10 days.A random sample of 25 accounts gives an average of 54 days outstanding with a standard deviation of 8 days.Determine the critical value for α = .01 to test the hypotheses,and,using the test statistic,determine if the manager should be concerned.