Accounting procedures allow a business to evaluate their inventory at LIFO

Accounting procedures allow a business to evaluate their inventory at LIFO (Last In First Out) or FIFO (First In First Out). A manufacturer evaluated its finished goods inventory (in $ thousands) for five products both ways. Based on the following results, is LIFO more effective in keeping the value of his inventory lower?

1. What is the null hypothesis?

A) uF = uL

B) uF≠uL

C) ud<0

D) ud = 0

1. What is the alternate hypothesis?

A) uF = uL

B) uF≠uL

C) ud=0

D) ud> 0

1. What is the degree of freedom?

A) 4

B) 5

C) 15

D) 10

1. If you use the 5% level of significance, what is the value of p?

A) .2017

B) .7983

C) .9300

D) .05

1. What is the decision at the 5% level of significance?

A) Fail to reject the null hypothesis and conclude LIFO is more effective.

B) Reject the null hypothesis and conclude LIFO is more effective.

C) Reject the alternate hypothesis and conclude LIFO is more effective.

D) Fail to reject the null hypothesis and conclude LIFO is not more effective.

1. This example is what type of test?

A) One sample test of means.

B) Two sample test of means.

C) Paired t-test.

D) Test of proportions.

Use the following to answer questions

To compare the effect of weather on sales of soft drinks, a soda manufacturer sampled two regions of the country with the following results. Is there a difference in sales between the 2 regions?

1. What is the null hypothesis?

1. π_a = π_b

2. _{µa = µb}

3. π_a = 0

4. _{µd = 0}

1. What is the alternate hypothesis?

1. _{µa = µb}

2. π_a = 0

3. π_a ≠ π_b

4. π_a<π_b

1. What is the proportion of sales made in Market Area B? ______

1. 0.33

2. .42

3. .15

4. .05

1. Using the 1% level of significance, what is the value of p _____

1. .0007

2. .9993

3. .0612

4. 0

1. What is your decision? ____________________

1. reject null

2. reject the alternative

3. accept the null

4. stop drinking soft drinks

1. What is your conclusion

1. There is a difference in sales between the two regions

2. There is no difference in sales between the two regions

3. There isn’t enough information to run a test

4. Weather is good for sales

Use the following information to answer question

To test the effectiveness of a business school preparation course, 8 students took a general business test before and after the course. The results are given below.

1. At the 0.05 level of significance, the conclusion for this hypothesis test is that there is sufficient evidence that

A) the business school preparation course does improve exam score.

B) the business school preparation course does not improve exam score.

C) the business school preparation course has no impact on exam score.

D) No conclusion can be drawn from the information given.