Instruction 10-5
a Buyer for a Manufacturing Plant Suspects That

question 129

Essay

Instruction 10-5
A buyer for a manufacturing plant suspects that his primary supplier of raw materials is overcharging. In order to determine if his suspicion is correct, he contacts a second supplier and asks for the prices on similar various materials. He wants to compare these prices with those of his primary supplier. The data collected is presented in the table below, with some summary statistics presented (all of these might not be necessary to answer the questions which follow). The buyer believes that the differences are normally distributed and will use this sample to perform an appropriate test at a level of significance of 0.01.
$\begin{array}{llll}\text {Material}&\text {Primary Supplier}&\text {Secondary}&\text {Difference}\\&&\text { Supplier }\\ 1 & \$ 55 & \$ 45 & \$ 10 \\2 & \$ 48 & \$ 47 & \$ 1 \\3 & \$ 31 & \$ 32 & -\$ 1 \\4 & \$ 83 & \$ 77 & \$ 6 \\5 & \$ 37 & \$ 37 & \$ 0 \\6 & \$ 55 & \$ 54 & \$ 1 \\\hline \text { Sum: } & \$ 309 & \$ 292 & \$ 17 \\\text { Sum of Squares: } & \$ 17,573 & \$ 15,472 & \$ 139\end{array}$

-Referring to Instruction 10-5,the hypotheses that the buyer should test are a null hypothesis that _______ versus an alternative hypothesis that __________.

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Definitions:

Genuine Desire

Authentic and sincere interest or wish for something to happen or to be obtained.

Strategic Initiative

A comprehensive plan crafted to achieve specific goals that will significantly impact a business's direction in the long term.

Acquisition

The act of acquiring or gaining possession, often referring to one company purchasing most or all of another company's shares to gain control.

Storage Management Software

Software tools designed to efficiently manage data storage resources and ensure optimal performance of a computer's storage systems.