The calculated value of the Z statistic to test the potential buyer's belief at the 1% significant level is -2.57512627.
The calculated Z score is slightly greater than the critical value of -2.575, the potential buyer's view that weekly store revenues are less than $7,000 stands vindicated.
Since store revenues are assumed to be normally distributed and population standard deviation is given, we can use the Z-test. The relevant test statistic is the Z-score.
We use the following formula for calculating the Z score:
Z = (X - μ) / (σ /√n)
Substituting the relevant values we get,
Z = (6400 -7000) / (1042/√20)
Z = -600 / 232.9982833
Z = -2.57512627
Answer:
Option C is the answer
Explanation:
The degree of operating leverage is measured by dividing the contribution margin by operating income.
The degree of operating leverage (DOL) is the ratio of contribution margin to operating income. It measures how much the operating income of a company will change in response to a change in sales. A Companies that have higher proportion of fixed costs to variable cost will have greater levels of operating leverage.
A. Vending Machine is a nonstore retailer
Answer: Pure play
Explanation:
A pure play method in finance is an approach that is used to estimate and determine the cost of equity capital of a private company which involves looking at the beta coefficient of other single focused and public companies.
Pure-play companies are the companies that are involved in a single line of business.
