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

question 175

Short Answer

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,what is the 99% confidence interval estimate for the mean difference in prices?

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Definitions:

Proactive Interference

The phenomenon where older memories interfere with the recall of newer memories.

Racquetball

A fast-paced sport played with a small rubber ball and a racquet in an indoor court by two or four players.

Semantic Memory

A type of long-term memory that involves the capacity to recall words, concepts, or numbers, which is essential for the understanding and use of language.

General Knowledge

encompasses a broad range of information across various subjects and disciplines that an individual accumulates throughout life.