A Methods and Measurement Analyst Wants to Develop a Time

question 86

Multiple Choice

A methods and measurement analyst wants to develop a time standard for a certain task. In a preliminary study, he observed one worker perform the task six times with an average observed time of 20 seconds and a standard deviation of two seconds.
How many observations should be made if he wants to be 95.44 percent confident that the maximum error in the observed time is one second?

• A) 3
• B) 4
• C) 13.3
• D) 16
• E) 25

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Definitions:

Residual Income

The income that remains after deducting all required costs of capital from the operating income.

Imputed Interest

The interest that is considered or assumed to be charged on an interest-free loan or bond, often for tax calculations.

Residual Income

The income that remains after subtracting all the costs of capital from the net operating income.

Net Operating Income

Earnings before interest and taxes (EBIT), a measure of a company's profitability from operations.