solution

Offshoring companies. Refer to The Journal of Applied Business Research (January/February 2011) study of offshoring companies, Exercise 10.10 (p. 607). In addition to U.S. firms, CEOs from international companies were also surveyed on their offshoring positions. The number of firms in each position category (adapted from the results of the actual study) is shown in the accompanying table. Does a firm’s position on offshoring depend on the firm’s nationality? Test using  = .05.

Exercise 10.10

Offshoring companies. “Offshoring” is a term that describes a company’s practice of relocating jobs and/or production to another country to reduce labor costs. The Journal of Applied Business Research (January/February 2011) published a study on the phenomenon of offshoring and how prevalent it is worldwide. The article included the results from a recent survey of CEOs at U.S. firms, where each CEO was asked about his or her firm’s position on offshoring. A summary of the results (similar to the actual study) is shown in the accompanying table.

a. Identify the qualitative variable of interest (and its levels) for this study.

b. Are the proportions of U.S. firms in the four offshoring position categories significantly different? Conduct the appropriate chi-square test using a = .05.

c. Construct a 95% confidence interval for the proportion of U.S. firms who are currently offshoring. Interpret the result.