Ernie Company Makes Three Types of Products

question 39

Multiple Choice

Ernie Company makes three types of products.The company has two types of customers.The cost to serve all customers is $12,000 and is allocated to customer types based on the number of manager visits to customer locations.The following data are available: What is the cost to serve for Customer Type 1?

• A)$2,400
• B)$6,000
• C)$9,600
• D)$12,000

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Definitions:

Z-score

A statistical measure that describes a value's relationship to the mean of a group of values, expressed in terms of standard deviations from the mean.

Variability

A quantitative measure that describes the degree to which scores in a distribution are spread out or clustered together.

Standard Deviation

A measure of variability that represents the average amount by which individual scores in a distribution vary from the mean.

Variance

A measure of variability that represents the mean of all squared deviation scores.