A Consumer Is Interested in Investigating the Difference in Price

question 32

Essay

A consumer is interested in investigating the difference in price between regular and premium gasoline at major filling stations in the U.S.A.An independent,random sample of stations is chosen and the prices per gallon are recorded for regular and premium gasoline.A histogram or Normal probability plot of the differences would be needed to verify the Nearly Normal Condition. $$\begin{array} { c | c | c } \text { Station } & \begin{array} { r } \text { Regular } \\( \$ / g a l )\end{array} & \begin{array} { c } \text { Premium } \\( \$ / g a l )\end{array} \\\hline \text { A } & 1.62 & 1.75 \\\text { B } & 1.52 & 1.59 \\\text { C } & 1.32 & 2.12 \\\text { D } & 2.02 & 2.14 \\\text { E } & 1.98 & 2.21 \\\text { F } & 1.83 & 1.89 \\\text { G } & 1.65 & 1.91 \\\mathrm { H } & 1.91 & 2.02 \\\text { I } & 1.75 & 1.89\end{array}$$

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Definitions:

Cash Inflows

Money received by a business from various sources, including sales, investments, and financing activities.

Project Profitability Index

A financial metric used to evaluate the attractiveness of a project or investment, calculated as the present value of future cash flows divided by the initial investment.

Investment Proposals

Plans or suggestions put forward for consideration by stakeholders with the objective of investing resources with the expectation of generating returns.

Discount Rate

The discount rate applied in DCF analysis for calculating today's value of future cash flows.