Question

Offshoring is described as relocating jobs and/or production to another country to reduce labor costs. A recent study surveyed CEOs at 600 US firms to determine the company's position on offshoring. A summary of the results is shown here, as well as an analysis that was conducted in the study: Category 126 Position Number of Companies Currently Offshoring Plan to Offshore in future Used to, but no more Offshoring not applicable 372 727 30 Multinomial Test Hypothesized Proportions Variable: Expected Observed Frequencies Variable: Obs Firms Category Observed Frequency 126 RHM Hypothesized Proportion 0.250000 0.250000 0.250000 0.250000 Expected Frequency 150.00 150.00 150.00 150.00 Chi-Square contribution 3.84 40.56 96.00 328.56 72 30 372 Overall Chi-Square P-Value Degrees of Freedom 468.96 0.0001 Bonferroni All-Pairwise Comparisons Test of Firms Position HAM Category Proportion Homogeneous Groups 0.62 0.21 0.12 0.05 Alpha 0.06 Give the conclusion for the test in the words of the problem. Each answer begins with, “At a=.05,... ...there is insufficient evidence to indicate that the proportion of US firms in the four offshoring position categories are equal. there is insufficient evidence to indicate that at least two of the proportion of US firms in the four offshoring position categories significantly differ.

Answer 1

Since pvalue = 0.001 < .05 , hence H₀ is rejected.

Answer: (c) there is sufficient evidence to indicate that at least two of the proportion of firms significantly differ.