Advertising expenses are a significant component of the cost of goods sold. List
ID: 3178654 • Letter: A
Question
Advertising expenses are a significant component of the cost of goods sold. Listed below is a frequency distribution showing the advertising expenditures for 70 manufacturing companies located in the Southwest. The mean expense is $50.71 million and the standard deviation is $11.59 million. Is it reasonable to conclude the sample data are from a population that follows a normal probability distribution?
Advertising expenses are a significant component of the cost of goods sold. Listed below is a frequency distribution showing the advertising expenditures for 70 manufacturing companies located in the Southwest. The mean expense is $50.71 million and the standard deviation is $11.59 million. Is it reasonable to conclude the sample data are from a population that follows a normal probability distribution?
Explanation / Answer
State the decision rule. Use the .10 significance level. (Round your answer to 3 decimal places.) Reject H0 if 2 > 7.779 H0: The population of advertising expenses follows a normal distribution. H1: The population of advertising expenses does not follow a normal distribution. Compute the value of chi-square. (Round your answer to 4 decimal places.) Observed frequency Expected frequency (Observed - Expected)^2 (Observed - Expected)^2 /Expected 7 5.2056 3.2200 0.6186 14 15.6444 2.7041 0.1728 25 23.3267 2.7998 0.1200 15 17.2789 5.1933 0.3006 9 6.3521 7.0114 1.1038 2 = 2.3158 Since 2.3158 < 7.779, we fail to reject Ho Conclusion: There is no sufficient evidence that the distribution is not normal.Related Questions
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