Consider the following scenario:

The privately owned Baker Company was founded in 1960. The company manufactures kitchen cabinets and has been very successful, expanding from one facility to twelve facilities in the same and other states. All facilities but the original are located near interstate highways. The original facility, which is no longer the headquarters, is in a downtown area of a major city (which grew up around it) with relatively high real-estate taxes. It has had a negative contribution margin and a net loss for the last five years. The founder is retired and three of his children want to close the facility. The fourth does not, because it "was Dad's first place and I went there every day after school." She believes they can bring the facility back to profitability if the city's downtown revitalization project succeeds and they dedicate the first floor of the facility to retail.

Consider:

• Your definition for "negative contribution margin."
• Whether the fact that the facility is not near an interstate makes a difference in the decision.
• Would it make a difference if the company were publicly traded?
• Might there be additional costs, in addition to revenues, to convert the first floor of the facility to retail?
• What risks may be associated with leasing to retail stores?
• What is your recommendation? Close and sell the facility or modify the first floor to be able to lease to retail stores.

Store Closing?

For this discussion, consider the following scenario:

The privately owned Baker Company was founded in 1960. The company manufactures kitchen cabinets and has been very successful, expanding from one facility to twelve facilities in the same and other states. All facilities but the original are located near interstate highways. The original facility, which is no longer the headquarters, is in a downtown area of a major city (which grew up around it) with relatively high real-estate taxes. It has had a negative contribution margin and a net loss for the last five years. The founder is retired and three of his children want to close the facility. The fourth does not, because it "was Dad's first place and I went there every day after school." She believes they can bring the facility back to profitability if the city's downtown revitalization project succeeds and they dedicate the first floor of the facility to retail.

• Your definition for "negative contribution margin."
• Whether the fact that the facility is not near an interstate makes a difference in the decision.
• Would it make a difference if the company were publicly traded?
• Might there be additional costs, in addition to revenues, to convert the first floor of the facility to retail?
• What risks may be associated with leasing to retail stores?
• What is your recommendation? Close and sell the facility or modify the first floor to be able to lease to retail stores.

The National Institute of Mental Health published an article stating that in any one-year period, approximately 9.5% of American adults suffer from depression or a depressive illness. Suppose that in a survey of hundred people in a certain town, seven of them suffered from depression or a depressive illness. Conduct a hypothesis test to determine if the true proportion of people in that town suffering from depression or a depressive illness is lower than the percentage in the general adult American population

The body temperatures in degrees Fahrenheit of a sample of adults in one small town are:

Assume body temperatures of adults are normally distributed. Based on this data, find the 99% confidence interval of the mean body temperature of adults in the town. Enter your answer as an open-interval (i.e., parentheses) accurate to 3 decimal places. Assume the data is from a normally distributed population.

99% C.I. =    

The number of snowplows needed by a town is given by

s(p)=0.5p−0.01p^2. snowplows where p is the population (in thousands).

The projected population of the town t years from now is p(t)=150(1+12e^−0.02t)^-1 thousand people.

(a) Write the model for the rate-of-change of the number of snowplows needed t years from now.

(b) What will be the rate-of-change of the number of snowplows needed five years from now?

Suppose it is known that the probability of being susceptible to contract a seasonal flu disease in a town is 0.20. A bio-statistician randomly selected 12 unrelated people from the town and examined if they are susceptible to the disease. Considering upto 4 decimal places, find the following: (a) expected number of susceptible individuals; (b) probability that 2 or fewer susceptible individuals; (c) probability that exactly 3 susceptible individuals; (d) probability that at least 4 susceptible individuals.

Exit polling is a popular technique used to determine the outcome of an election prior to results being tallied. Suppose a referendum to increase funding for education is on the ballot in a large town (voting population over 100,000). An exit poll of 500 voters finds that 240voted for the referendum. How likely are the results of your sample if the population proportion of voters in the town in favor of the referendum is 0.51? Based on your result, comment on the dangers of using exit polling to call elections.

The body temperatures in degrees Fahrenheit of a sample of adults in one small town are:

98.3 96.7 98.6 98.2 97.7 99.5 99.4 98

Assume body temperatures of adults are normally distributed. Based on this data, find the 80% confidence interval of the mean body temperature of adults in the town. Enter your answer as an open-interval (i.e., parentheses) accurate to 3 decimal places. Assume the data is from a normally distributed population.

80% C.I. =

7. Circus

A traveling circus has found that its average attendance per performance is 6000 people with a

standard deviation of 1500. Assume that attendance is normally distributed.

a)

Suppose that a town asks the circus to come, but the only available site in town holds a

maximum of 8000 people. What is the probability that this site will reach capacity?

b)

If the circus loses money on 20% of its performances, what attendance must it have to

break even for a performance?

Suppose a 90% confidence interval for the mean salary of college graduates in a town in Mississippi is given by [$45,783, $57,017]. The population standard deviation used for the analysis is known to be $13,700. [You may find it useful to reference the z table.]

a. What is the point estimate of the mean salary for all college graduates in this town?

b. Determine the sample size used for the analysis. (Round "z" value to 3 decimal places and final answer to the nearest whole number.)