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John, a medical practitioner at a private medical facility, is discussing the problem that one of his patients, Tom, says he has been having with the medication that the doctor has prescribed. It is a new medication and the facility has been asked to gather information about the medication for the manufacturer. At a previous visit to the doctor, Tom was complaining that the medication made his stomach upset. A check of the medication reactions data shows 0% reports on stomach upset in extensive testing. The doctor has asked Tom to fill out a log sheet of when he takes the medication and when, after that, that he feels his stomach get upset.
John takes the log sheet and gives the data to his doctor. The agency he sends it to calculates a correlation coefficient for the data. The calculation shows that there is a positive 0.85 correlation between taking the medication and stomach upset.
Tom sees the number and says, "See, that proves it. The medication causes stomach upset!"
What do you have to say about Tom's statement?
Inventories represent a considerable investment for every organization; thus, it is important that they be managed well. Excess inventories can indicate poor financial and operational management.
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Assuming that the standard deviation and the normal shape are unchanged, to what level must the mean reduce so that 20 gallons per week is the third quartile rather than the mean?
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