Question

In: Statistics and Probability

The purchasing director for an industrial parts factory is investigating the possibility of purchasing a new...

The purchasing director for an industrial parts factory is investigating the possibility of purchasing a new type of milling machine. She determines that the new machine will be bought if there is evidence that the parts produced have a higher average breaking strength than those from the old machine. A sample of 100 parts taken from the old machine indicates a sample mean of 65 kilograms and standard deviation is 10 kilograms. Whereas a similar sample of 100 from the new machine indicates a sample mean of 72 kilograms and a standard deviation of 9 kilograms. Is there evidence that the purchasing director should buy the new machine? Test at 5% significance level. Assume the two population variances are not equal

Solutions

Expert Solution


Related Solutions

The CFO of The Fun Factory is investigating the possibility of investing in a three dimensional printer that would cost $20,000.
The CFO of The Fun Factory is investigating the possibility of investing in a three dimensional printer that would cost $20,000. The printer would eliminate the need to have prototypes of new toys be produced by a third party. The cost of having the prototypes manufactured by the third party is about $8,000 per year. The printer would have a useful life of five years with no salvage value with expected annual operating costs of $3,000 per year.   Required: Compute...
ABC Company is considering the possibility of building an additional factory that would produce a new...
ABC Company is considering the possibility of building an additional factory that would produce a new addition to their product line. The company is currently considering two options. The first is a small facility that it could build at a cost of $6 million. If demand for new products is low, the company expects to receive $10 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects...
Expando, Inc., is considering the possibility of building an additional factory that would produce a new...
Expando, Inc., is considering the possibility of building an additional factory that would produce a new addition to their product line. The company is currently considering two options. The first is a small facility that it could build at a cost of $6 million. If demand for new products is low, the company expects to receive $10 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects...
Expando, Inc., is considering the possibility of building an additional factory that would produce a new...
Expando, Inc., is considering the possibility of building an additional factory that would produce a new addition to their product line. The company is currently considering two options. The first is a small facility that it could build at a cost of $6 million. If demand for new products is low, the company expects to receive $10 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects...
International Trade The Director of Purchasing for parts distribution company wants to purchase steel coach screws...
International Trade The Director of Purchasing for parts distribution company wants to purchase steel coach screws from Germany; however, he is not sure what the best option is. The director comes to you and asks your opinion. You know that Germany, Canada, and Korea are the best sources for obtaining this product. While your research shows coach screws from Germany are of the highest quality, the United States imposes a tariff of 12.5%, which makes this option noncompetitive. Which US...
Suppose that the director of manufacturing at a clothing factory needs to determine whether a new...
Suppose that the director of manufacturing at a clothing factory needs to determine whether a new machine is producing a particular type of cloth according to the manufacturer’s specifications, which indicate that the cloth should have a mean breaking strength of 70 pounds and a standard deviation of 3.5 pounds. A sample of 49 pieces reveals a sample mean of 69.1 pounds. The director is willing to tolerate a probability of .05 of rejecting the null hypothesis when it is...
You are investigating the possibility of investing in a productive oil well that is expected to...
You are investigating the possibility of investing in a productive oil well that is expected to produce 2,500 barrels of oil per year for 5 years. The current price of oil is $70 per barrel, but the price is expected to increase at a constant rate of 3 percent per year for the next 5 years. If your opportunity cost of funds is 13.50 percent p.a., what would be the upper limit of how much you would be willing to...
Problem 1. The director of manufacturing at a clothing factory needs to determine whether a new...
Problem 1. The director of manufacturing at a clothing factory needs to determine whether a new machine is producing a particular type of cloth according to the manufacturer’s specifications, which indicate that the cloth should have a mean breaking strength of 70 pounds and a standard deviation of 3.5 ponds. A sample of 49 pieces of cloth reveals a sample mean breaking strength of 69.1 pounds. Is there evidence that the machine is not meeting the manufacturer’s specifications for mean...
1. McCormick & Company is considering purchasing a new factory in Largo, Maryland. The purchase price...
1. McCormick & Company is considering purchasing a new factory in Largo, Maryland. The purchase price of the factory is $750,000. The investment value of the factory is $868,080. What is the net present value? 2. If McCormick & Company decides to purchase the new factory in Largo, they need to consider relevent after-tax cash flow. McCormick & Company estimated their potential first-year sales revenue at $600,000, expenses at $225,000, and depreciation expense at $150,000. McCormick's marginal tax rate is...
Your company is considering purchasing new machinery for the factory to upgrade and replace outdated equipment...
Your company is considering purchasing new machinery for the factory to upgrade and replace outdated equipment that will cost $4 Million right away. The machinery is projected to last 6 years, after which it can be sold for $500,000. The upgraded equipment will be able to produce more product and result in additional sales of $1.25 Million per year. Operating the new equipment will add $200,000 per year in expenses. Additionally, a one-time expense of $1.5 Million at the end...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT