Morning House is a mail-order firm which carries a wide
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- You manage a systems engineering firm, and you often get projects by bidding on them. Animportant aspect of bidding on such projects is estimating the amount to bid: a bid that’s toohigh may mean your firm isn’t awarded the project, but a bid that’s too low may mean you areawarded the project and lose money in the process. You have two cost engineers that estimateproject costs. Engineer 1 estimates about 70% of bids while Engineer 2 estimates the rest. It isknown that the error rate for Engineer 1 is such that 0.02 is the probability of an error occurswhen she does the cost estimation, whereas the probability of an error in the estimate ofEngineer 2 is 0.04. Suppose a bid arrives and a serious error occurs in estimating cost. Whichengineer would you guess did the work?arrow_forwardA certain toll road averages 238,000 cars per day when charging $1 per car. A survey concluded that increasing the toll will result in 700 fewer cars for each cent of toll increase. What toll should be charged in order to maximize the revenue?arrow_forwardProfitability remains a challenge for banks and thrifts with less than $2 billion of assets. The business problem facing a bank analyst relates to the factors that affect return on assets (ROA), an indicator of how profitable a company is relative to its total assets. Data collected from a sample of 194 community banks include the ROA (%), the efficiency ratio (%), as a measure of bank productivity (the lower the efficiency ratio, the better), and total risk-based capital (%), as a measure of capital adequacy. A multiple linear regression model resulted in an SSR of 5.25 and an SSE of 125.02. Calculate the test statistic. FSTAT=____________ (Round to two decimal places as needed.)arrow_forward
- Netflix made headlines in September 2011 when it split its streaming video service and its DVD by-mail service into two companies. This decision was based on projections that streaming videos will replace DVDs in the future. In this problem, you will explore these projections. Numbers below are close to the correct values, but vary to allow more practice with this idea. Total DVD and Blu-ray disc sales in 2009 were $8.72 billion. For the purposes of this problem, you will combine DVD and Blue-ray disk sales into one category of DVD sales. A study by In-Stat predicted that "physical disc sales will decline by $4.7 billion by 2014," and that "streaming, on the other hand, should grow from its current $2.1 billion to $6.3 billion over the same time period (2009–2014)."12 What is the slope, including units, of the model for DVD sales?arrow_forwardProfitability remains a challenge for banks and thrifts with less than $2 billion of assets. The business problem facing a bank analyst relates to the factors that affect return on assets (ROA), an indicator of how profitable a company is relative to its total assets. Data collected from a sample of 73 community banks include the ROA (%), the efficiency ratio (%), as a measure of bank productivity (the lower the efficiency ratio, the better), and total risk-based capital (%), as a measure of capital adequacy. Use the accompanying multiple linear regression results to complete parts (a) and (b) below. Variable Coefficient Standard Error 0.30408 0.00539 -0.24116 0.01953 0.04922 0.01517 Intercept Efficiency Ratio, X₁ Risk-Based Capital, X₂ t Statistic - 0.79 3.62 3.24 (Round to four decimal places as needed.) p-value 0.4304 0.0005 0.0018 C a. Construct a 95% confidence interval estimate of the population slope between ROA and efficiency ratio.arrow_forwardProfitability remains a challenge for banks and thrifts with less than $2 billion of assets. The business problem facing a bank analyst relates to the factors that affect return on assets (ROA), an indicator of how profitable a company is relative to its total assets. Data collected from a sample of 20 community banks include the ROA (%), the efficiency ratio (%), as a measure of bank productivity (the lower the efficiency ratio, the better), and total risk-based capital (%), as a measure of capital adequacy. Complete parts (a) through (g) below. Click the icon to view the data table. a. State the multiple regression equation. Let X₁, represent the efficiency ratio (%) and let X₂; represent the total risk-based capital (%). Ý TO DX DX = + + (Round the constant to two decimal places as needed. Round the coefficients to four decimal places as needed.) Distribution Costs ROA (%) 1.13 1.22 0.82 1.15 0.81 1.23 0.67 1.35 0.95 0.71 0.69 1.10 0.87 1.02 0.86 1.74 1.02 1.76 0.90 0.68 Efficiency…arrow_forward
- Netflix made headlines in September 2011 when it split its streaming video service and its DVD by-mail service into two companies. This decision was based on projections that streaming videos will replace DVDs in the future. In this problem, you will explore these projections. Numbers below are close to the correct values, but vary to allow more practice with this idea. Total DVD and Blu-ray disc sales in 2009 were $8.72 billion. For the purposes of this problem, you will combine DVD and Blue-ray disk sales into one category of DVD sales. A study by In-Stat predicted that "physical disc sales will decline by $4.7 billion by 2014," and that "streaming, on the other hand, should grow from its current $2.1 billion to $6.3 billion over the same time period (2009–2014)."12 What is the slope, including units, of the model for DVD sales? Write a statement interpreting the meaning of the slope in the context of the problem.arrow_forwardProfitability remains a challenge for banks and thrifts with less than $2 billion of assets. The business problem facing a bank analyst relates to the factors that affect return on assets (ROA), an indicator of how profitable a company is relative to its total assets. Data collected from a sample of 20 community banks include the ROA (%), the efficiency ratio (%), as a measure of bank productivity (the lower the efficiency ratio, the better), and total risk-based capital (%), as a measure of capital adequacy. Complete parts (a) through (g) below. Click the icon to view the data table. a. State the multiple regression equation. Let X₁¡ represent the efficiency ratio (%) and let X₂¡ represent the total risk-based capital (%). Ŷ₁=+X₁₁+Xzi (Round the constant to two decimal places as needed. Round the coefficients to four decimal places as needed.) Distribution Costs ROA (%) 1.04 0.77 0.14 1.44 0.90 1.16 1.07 1.58 1.45 1.15 1.17 3.40 0.86 0.66 0.81 1.14 0.83 0.86 1.14 1.04 TOlal Efficiency…arrow_forwardWhen a company offers a new product or service, they estimate how much of that product or service people will want at different prices. This is referred to as the product or service demand . As the price of a product or service increases, the demand usually decreases, and this drives the price down. Companies use the estimated demand to determine how much of a product or service they are willing to supply at different prices. As the price of a product or service increases, companies are willing to supply more of it because they will earn more money. If you graph the demand and the supply curves on the same xy-plane, they will sometimes intersect at the point where the price and the supply are in equilibrium. Consider the scenario below. Yaseen is a local artist who wants to increase the amount of money she earns every month by selling at-home painting kits. These kits will include a photograph of the finished painting, a link and password to Yaseen’s YouTube channel where she will…arrow_forward
- Cyber Security Systems had sales of 4,100 units of $95 per unit last year. The marketing manager projects a 30 percent increase in unit volume sales this year with a 20 percent price increase. Returned merchandise will represent 15 percent of total sales. What is your net dollar sales projection for this year?arrow_forwardThe table below gives data on three movies. Gross earnings is the amount of money the movie brings in. Compare the net earnings (money made after expenses) for the three movies. Which provided the best return on investment? Release Date 10/29/2004 12/19/1997 $200,000,000 | Jurassic Park | 06/11/1993 | $63,000,000 Movie Saw Titanic Budget $1,200,000 Gross Earnings $103,096,345 $1,842,879,955 $923,863,984arrow_forwardTotal DVD and Blu-ray disc sales in 2009 were $8.72 billion. For the purposes of this problem, you will combine DVD and Blue-ray disk sales into one category of DVD sales. A study by In-Stat predicted that "physical disc sales will decline by $4.7 billion by 2014," and that "streaming, on the other hand, should grow from its current $2.2 billion to $6.3 billion over the same time period (2009–2014). d. Write an equation that represents the linear model for streaming videos. Let S = the total sales of streaming videos in billions of dollars, and t = the number of years after 2009. e. In what year do the models predict streaming video sales to exceed DVD sales?arrow_forward
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