A trend chart was produced by RSPE software and is shown below. Profit was defin

Question

A trend chart was produced by RSPE software and is shown below. Profit was defined as the output variable. In reference to the chart below, which of the following statements is true? Trend Chart Mean 75 Percent Band 90 Percent Band $70.00 $60.00 $50.00 $40.00 30.00 20.00 10.00 40 50 60 65 70 Parameter OrderQuantty The shaded areas represent information about the frequency distribution of profit. The middle band of shaded area represents 75% of the observed outcomes. The middle and outer shaded areas together represent 90% of the observed outcomes. A total of 10% of the simulated profit values are outside of the shaded area. All of the a

Explanation / Answer

Lets consider the given options,

1) The shaded area represents information about the frequency distribution of profit. This statement is true, from the graph.

2) The middle band of shaded area represents 75% of the observed outcomes. From the legend given in th graph, this is true.

3) The middle and outer shaded areas together represent 90% of the observed outcomes. From the legend given in th graph, this is true.

4) A total 10% of the simulated profit values are outside of the shaded area. This also true, because the shaded area represent only 90% of the outcomes, so the rest 10% must be outside this area.

Thus the answer is 5) All of the above

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