# The manager of the marketing division of Acme Corporation forecasts an average monthly sales in 1978 of

## Question:

The manager of the marketing division of Acme Corporation forecasts an average monthly sales in 1978 of $65,000. In the first seven months of 1978, the average monthly sales were $63,200, with a standard deviation of $500. The management wishes to test the hypothesis H_{o} that "statistically" the manager was right (H_{o}: ì = 65,000) against the alternative hypothesis that he was wrong in his forecast (H_{1}: ì ≠ 65,000), using a two-tail test. Assuming normal distribution of monthly sales, which of the following statements is true?

Hint - Calculate Z statistics with given information and compare with critical value for 5% (1%) significance level

None of the options.

H_{o} is rejected at the 5 percent significance level but accepted at the 1 percent significance level.

H_{o} is rejected at both the 5 percent and 1 percent significance levels.

H_{o} is accepted at both the 5 percent and 1 percent significance levels.

H_{o} is accepted at the 5 percent significance level but rejected at the 1 percent significance level.

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