A Mail-Order Business Prides Itself in Its Ability to Fill

question 115

Multiple Choice

A mail-order business prides itself in its ability to fill customers' orders in less than six calendar days, on average. Periodically, the operations manager selects a random sample of customer orders and determines the number of days required to fill the orders. On one occasion when a sample of 30 orders was selected, the average number of days was 6.65 with a sample standard deviation of 1.5 days. Assume the time in which an order is filled is normally distributed.

-Calculate the appropriate test statistic to test the hypotheses.

• A)2.37
• B)16.90
• C)0.65
• D)-2.37
• E)3.31

Identify the behaviors of average variable cost (AVC) and average total cost (ATC) as output changes.

Know the break-even and shutdown points in both short run and long run scenarios.

Distinguish between types of costs (fixed, variable, marginal).

Understand the role of total revenue in short-run operational decisions.

---

Definitions:

Minority Owned Business

A business that is at least 51% owned, operated, and controlled by individuals belonging to a racial or ethnic minority group.

Diversity

Describes race, gender, age, and other individual differences.

Start-Ups

Newly established businesses, often in the initial stages of operations, aiming to meet a marketplace need or solve a problem through a scalable business model.

Entrepreneurship

The process of designing, launching, and running a new business, often characterized by innovation, risk-taking, and the pursuit of growth.