A Fast-Food Franchise Is Considering Building a Restaurant at a Busy

question 111

Multiple Choice

A fast-food franchise is considering building a restaurant at a busy intersection. A financial advisor determines that the site is acceptable only if, on average, more than 300 automobiles pass the location per hour. The advisor tests the following hypotheses: H₀: μ ≤ 300.
H_A: μ > 300.
The consequences of committing a Type I error would be that ________.

• A) the franchiser builds on an acceptable site
• B) the franchiser builds on an unacceptable site
• C) the franchiser does not build on an acceptable site
• D) the franchiser does not build on an unacceptable site

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Definitions:

Professional Indemnity Insurance

Insurance that provides coverage to professionals against claims made by clients for loss or damage due to negligent services or advice.

Liability Coverage

A type of insurance that provides protection against claims resulting from injuries and damage to people or property.

Malpractice Claims

Legal claims made against professionals (e.g., doctors, lawyers) for failing to provide proper services, resulting in harm to the claimant.

Accountant-Client Privilege

A legal privilege that confidentializes communication between accountants and their clients, protecting certain information from being disclosed in legal proceedings.