Podcast
Questions and Answers
What is the objective of the study?
How many firms are in Stratum 1?
What is the total number of firms in the study?
If 50 firms were to be representative of each stratum, how many firms would be in Stratum 2?
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What is being labeled in the context of the food processor?
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Study Notes
Study of Firms' Advertising Spending
- Objective: Determine if firms with high returns on equity spend more on advertising than firms with low returns or a deficit.
- 352 firms divided into 5 strata based on profitability:
- Stratum 1: 30% and over (8 firms)
- Stratum 2: 20% to 30% (35 firms)
- Stratum 3: 10% to 20% (189 firms)
- Stratum 4: 0% to 10% (115 firms)
- Stratum 5: Deficit (5 firms)
- Representative sample: 50 firms from each stratum
Unrelated Problem: Food Processor
- A food processor has 20 large lots of canned mushrooms ready for shipping
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Description
A study aims to determine if firms with high returns on equity spend more on advertising. The study involves 352 firms divided into 5 strata based on profitability. This quiz will explore the concept of stratified sampling.
