A Restaurant Chain Has Two Locations in a Medium-Sized Town

question 127

Multiple Choice

A restaurant chain has two locations in a medium-sized town and, believing that it has oversaturated the market for its food, is considering closing one of the restaurants. The manager of the restaurant with a downtown location claims that his restaurant generates more revenue than the sister restaurant by the freeway. The CEO of this company, wishing to test this claim, randomly selects 36 monthly revenue totals for each restaurant. The revenue data from the downtown restaurant have a mean of $360,000 and a standard deviation of $50,000, while the data from the restaurant by the freeway have a mean of $340,000 and a standard deviation of $40,000. Assume there is no reason to believe the population standard deviations are equal, and let μ₁ and μ₂ denote the mean monthly revenue of the downtown restaurant and the restaurant by the freeway, respectively. Which of the following is the appropriate critical value(s) to test the manager's claim at the 5% significance level?

• A) 1.645
• B) 1.668
• C) 1.960
• D) 1.997

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Definitions:

Observational Learning

A learning process in which individuals change their behaviors or acquire new knowledge by watching others, not by direct experience.

Social Learning Theory

Social Learning Theory posits that people learn from one another through observation, imitation, and modeling, encompassing the effects of environment, behavior, and cognition.

Insight Learning

A psychological phenomenon where a problem is suddenly understood or solved without the trial-and-error method, often seen as an "aha" moment.

Insight

Insight involves the ability to understand the inner nature of things or a clear, deep understanding of a complicated problem or situation.