Consider the Following to Answer the Question(s) Below

question 34

Multiple Choice

Consider the following to answer the question(s) below:
The Dispenser Right Company makes a soft drink dispensing machine used in many fast food restaurants. When the machine is running properly, the average number of fluid ounces in the cup should be 14. Periodically the machines need to be tested to make sure that they have not gone out of adjustment. To do this, six cups are filled by the machine and a technician carefully measures the volume in each cup. In one such test, the following data were observed:

-At 5%

• A) We fail to reject the null hypothesis and do not adjust the machines because there is not enough evidence to show they are not functioning properly.
• B) We reject the null hypothesis.
• C) We know the machines are working properly.
• D) We know the machines need adjustment.
• E) We reject the null hypothesis and adjust the machines because there is enough evidence to show they are not functioning properly.

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Definitions:

Consumption Bundle

A combination of goods and services that a consumer chooses to consume given their budget constraints.

Utility Function

A mathematical representation of how consumers rank different bundles of goods according to their level of satisfaction or utility.

Consumption

The process by which goods and services are used up by consumers.

Indifference Curves

A graphical representation showing combinations of goods or services among which a consumer is indifferent, depicting equal levels of utility.