Question: Information technology. A recent report suggests that Chief Information Officers (CIO’s) who report directly to Chief Financial Officers (CFO’s) rather than Chief Executive Officers (CEO’s) are more likely to have IT agendas that deal with cost cutting and compliance (SearchCIO.com, March 14, 2006). In a random sample of 5 35 companies, it was found that CIO’s re- ported directly to CF 0’s in 173 out of 335 service firms anti in 95 out of 200 manufacturing companies.

1. Is there evidence that type of business (service versus manufacturing) and whether or not the CIO reports directly to the CFO are associated?
2. If your conclusion proves to be wrong, did you make a Type I or Type II error?
3. Give a 95% confidence interval for the difference in proportions of companies in which the CIO reports directly to the CFO between service and manufacturing firms.

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