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Statistics (Alliance University)

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Quiz.doc

1. Consider the following frequency distribution:-

What is the relative frequency of the first class?

(a) 0.15 (b) 0.30 (c) 0.10 (d) None of the above

2. A statistics student made the following grades on 5 tests: 84, 78, 88, 78, and 72. What is the mean grade?
(a) 84 (b) 72 (c) 80 (d) 78

3. Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the following performance
statistics for two new stocks:-

The coefficient of variation for Salas Products, Inc. is ______.

(a) 300% (b) 33% (c) 5% (d) 100%

4. Let A be the event that a student is enrolled in an accounting course and let S be the event that a student is
enrolled in a statistics course. It is known that 30% of all students are enrolled in an accounting course and
40% of all students are enrolled in statistics. Included in these numbers are 15% who are enrolled in both
statistics and accounting. Find P(S).
(a) 0.30 (b) 0.55 (c) 0.15 (d) 0.40

4. Given P(A) = 0.40, P(B) = 0.50, P(A ∩ B) = 0.15. Find P(B|A).

(a) 0.80 (b) 0.20 (c) 0.375 (d) 0.30

4. An automobile dealer wishes to investigate the relation between the gender of the buyer and type of vehicle
purchased. The following joint probability table was developed from the dealer's records for the previous
year:-

P(Male) = (a)____________________.
(a) 0.48 (b) 0.20 (c) 0.50 (d) 0.02

4. Variables which take on values only at certain points over a given interval are
called(a)____________________.

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(a) Value variables (b) Continuous random variables (c) Point variables (d) Discrete random
variables

4. The volume of liquid in an unopened 12-ounce bottle of beer is an example of (a)____________________.

(a) A discrete random variable (b) The binomial distribution (c) The normal distribution (d) A
continuous random variable

4. You are offered an investment opportunity. Its outcomes and probabilities are presented in the following
table:-

The mean of this distribution is (a)____________________.

(a) $400 (b) -$400 (c) $200 (d) $0

10. If x is a binomial random variable with n=10 and p=0.4, the mean of x is(a)____________________.

(a) 4 (b) 2.4 (c) 6 (d) 10

11. The variance of a Poisson distribution is equal to:-

(a) λ (b) λ2
(c) √λ (d) λ/2

11. The area to the left of the mean in any normal distribution is(a)____________________.

(a) Equal to the mean (b) Equal to 0.5 (c) Equal to 1 (d) Equal to the variance
13. Classifying students in a statistics course by their gender is an example of what scale of measurement?
1. Ordinal b.Nominal c.Interval d.Ratio

14. A ________________is a tabular summary of data showing the number of items in each of several non
overlapping classes.
a. Frequency distribution b. Relative frequency c. Probability distribution d. Cumulative
distribution
14. State whether the following question provided is qualitative or quantitative data and indicates the
measurement scale appropriate - What is your age?
a. Qualitative, ratio b. Quantitative, ratio c. Qualitative, nominal d.Quantitative,
ordinal

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14. Which of the following Circle Graphs best displays the data that is shown in the table below?

i.

a) A b) B c) C d) D

17 . If the coefficient of correlation is 0.4, the percentage of variation in the dependent variable explained by the variation in the
independent variable

a. is 40%

b is 16%.
.

c. is 4%

d can be any positive value

.

18. If P(A) = 0.50, P(B) = 0.60, and P(A ∩ B) = 0.30, then events A and B are

a. mutually exclusive events

b not independent events

.

c. independent events

d not enough information is given to answer this question

.

19. The measure of location which is the most likely to be influenced by extreme values in the data set is the

a. range

b median
.

c. mode

d mean

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20. The hourly wages of a sample of 130 system analysts are given below.

mean = 60 range = 20

mode = 73 variance = 324

median =
74

The coefficient of variation equals

a. 0.30%

b 30%
.

c. 5.4%

d 54%
.

ANSWERS

Question Answer
Number
1 B
2 C
3 B
4 D
5 C
6 C
7 D
8 D
9 D
10 A
11 A
12 B
13 B
14 A
15 B
16 C
17 B
18 C
19 D
20 B

Introduction and Descriptive Statistics

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1 A distribution that is relatively flat and wide is said to be:

.
A. skewed to the right

B. symmetric

C. platykurtic

D. kurtosis

E. none of the above

2. The following are the grades a professor gave on the first test in a statistics class: 52, 90, 88,
61, 75, 82, 75, 83, 88, and 86.

What was the median score on this test?

A. 82

B. 82.5

C. 78.5

D. 88

E. 75

3. A clothes store manager has sales data of trouser sizes for the last month's sales. Which
measure of central tendency should the manager use, if the manager is interested in the most
sellable size?
A. mean

B. median

C. mode

D. standard deviation

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E. interquartile range

4. The mean weight of three gemstones is 20 grams. The weights of two of the stones are 15
grams and 17 grams. What is the weight of the third stone?
A. 16 grams

B. 10 grams

C. 28 grams

D. 14 grams

E. not enough information to determine the weight of the third stone

5. A market research company has collected data on the price of a particular brand of soap in
several different locations. The prices are as follows: $0.89, 0.95, 1.25, 1.36, 1.49, 1.65,
1.79, 1.89, 1.99. What are the upper and lower quartiles of soap prices for this brand?
A. 1.72, 1.17

B. 1.84, 1.17

C. 1.72, 1.10

D. 2.21, 0.74

E. 1.84, 1.10

6. In a survey conducted among the employees of a local bank, it is found that the following
are the number of children each employee has: 1, 0, 2, 2, 0, 1, 0, 1, 4, 3, 6, 4, 2, 0, 1, and 3.
What is the mean number of children for these employees?
A. 2.5

B. 1.875

C. 1.5

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D. 2.0

E. 6.0

7. Several friends go to a casino and do some gambling. The following are the profits each of
these friends make: $120, -$230, $670, -$1020, $250, -$430, and -$60. What is the average
profit of this group?
A. $100

B. -$100

C. -$1020

D. $397

E. -$397

8. Find the variance of the following set of values: 2, 5, 8, 6, and 1.

A. 2.88

B. 4.4

C. 8.3

D. 7

E. 5

9. A measure of the degree of asymmetry of a frequency distribution is called?

A. kurtosis

B. skewness

C. coefficient of variation

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D. standard deviation

E. ogive

10. The graph of a cumulative frequency distribution is called?

A. ogive

B. pie chart

C. frequency polygon

D. histogram

E. bar chart

11. What measure of central tendency is most sensitive to skewness?

A. Mode

B. Median

C. Mean

D. They are all about the same

E. Median and Mean

12. The average amount of time required to fill orders at a drive-up window has been observed
to be 120 seconds, with a standard deviation of 10 seconds. Assuming that the required
order-fill time follows a symmetric, bell-shaped distribution, which of the following
statements is correct regarding a random sample of 1,000 observations?
We would expect to see approximately 680 of the order fill-times falling in the
A. interval from 110 seconds to 120 seconds

We would expect to see approximately 955 of the order fill-times falling in the
B. interval from 100 seconds to 140 seconds

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C We would expect to see approximately 27 orders with required fill-times of less

. than 90 seconds

D We would expect to see approximately 27 orders with required fill-times in excess

. of 150 seconds

E. All of the above are correct

Quiz - Probability

1. A box has 20 screws, three of which are known to be defective. What is the probability that
the first two screws taken out of the box are both defective?
A. 0.0158

B. 0.15

C. 0.0237

D. 0.0225

E. none of the above

2. The probability of stock A rising is 0.3; and of stock B rising is 0.4. What is the probability
that neither of the stocks rise, assuming that these two stocks are independent?
A. 0.42

B. 0.12

C. 0.88

D. 0.44

E. 0.70

3. The probability of stock A rising is 0.3; and of stock B is 0.4. If stocks A and B are not

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independent, and the probability of both stocks rising is 0.09, what is the probability that
neither stock rises?
A. 0.61

B. 0.39

C. 0.12

D. 0.91

E. 0.03

4. A bag has five pearls in it, out of which one is artificial. If three pearls are taken out at
random, what is the probability that the artificial pearl is one of them?
A. 1/5

B. 2/5

C. 3/5

D. 4/5

E. none of the above

5. Suppose that two events A and B are mutually exclusive. We know that the probability of A
is 0.4 and the probability of B is 0.2. The probability that either A or B (or both) will occur
is:
A. 0.08

B. 0.52

C. 0.60

D. 0

E. none of the above

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6. If the probability of A is 0.45 and the probability of the intersection of A and B is 0.15, then
the probability that B will occur given that A has occurred is:
A. 3.00

B. 1.00

C. 1/3

D. 1/9

E. 0.675

7. If P(A) = 0.2; P(B) = 0.6; and A and B are independent events, then the P(A U B) is:
A. P(A) + P(B)

B. P(A) x P(B)

C. P(A) + P(B) - P(A) x P(B)

D. zero

E. cannot be determined

8. If the probability of A is 0.5 and the probability of B is 0.2 and the probability of the union
of A and B is 0.7, then:
A. A and B are independent

B. A and B are mutually exclusive

C. A and B are dependent

D. A and B do have an intersection

E. impossible to determine

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9. I shoot at a target five times and each time my probability of hitting is 0.40. Assuming that
each shot is independent, my probability of hitting the target at least once is:
A. 0.01024

B. 0.07776

C. 0.92224

D. a number very close to zero

E. none of the above

10. The probability that I get job A is 0.45; the probability that I get job B is 0.60; and the
probability that I get both the jobs is 0.30. The probability that I get at least one job offer
is:
A. 0.30

B. 0

C. 1

D. 0.55

E. 0.75

11. The probability that event A will occur is 0.7 and the probability that event B will occur is
0.7, and the probability that both events will occur is 0.49. The two events are:
A. independent

B. mutually exclusive

C. dependent

D. disjoint

E. insufficient information to determine

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12. Five of the 12 members of the board of directors of Giganticus, Inc., will be placed on a
subcommittee that will decide if John Goodhair, Chairman and CEO, will remain in his
position. How many subcommittees are possible if members are randomly chosen?
A. 792

B. 879

C. 972

D. 95040

E. None of the above

-----------------------------------------------X Quiz.doc X -----------------------------------------------------

Q1. Which of the following is an example of nonprobabilistic sampling?

Ans: judgment sampling

Q. The uncontrollable future events that can affect the outcome of a decision are known as
a. alternatives
b. decision outcome
c. payoff
d. states of nature

Ans: states of nature

Q2. A student makes an 82 on the first test in a statistics course. From this, she assumes
that her average at the end of the semester (after other tests) will be about 82 this is an
example of---------------

a)descr
ipt
ivest
ati
st
ics
b)inf
erent
ials
tat
is
tic
s
c)populat
ionder
ivat
ion
d)samplepers
uasi
on
e)rel
at
iveleve
ldata

Ans
:b)i
nfe
rent
ials
tat
is
ti
cs

Q3. In a regression analysis, the coefficient of correlation is 0.16. The coefficient of determination in this
situation is
a. 0.4000

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b. 0.0256
c. 4
d. 2.56

Ans: 0.0256

Q4. Pinky Bauer, Chief Financial Officer of Harrison Haulers, Inc., suspects irregularities in the payroll system,
and orders an inspection of "each and every payroll voucher issued since January 1, 1999." Five
percent of the payroll vouchers contained material errors. This is an example of
_______________.

A. nonparametric statistics
B. nominal data
C. descriptive statistics
D. inferential statistics
Ans: ???

Q5. If the coefficient of determination is equal to 1, then the coefficient of correlation

Ans: can be either -1 or +1

Q6. For a standard normal distribution, the probability of obtaining a z value of less than 1.6 is
a. 0.1600
b. 0.0160
c. 0.0016
d. 0.9452

Ans: d. 0.9452

Q7. If a data set has SSR = 400 and SSE = 100, then the coefficient of determination is

Ans: 0.80

Q8. If arrivals occur according to the Poisson distribution every 20 minutes, then which is NOT true?

λ = 20 arrivals per hour

Q9. Classifying students in a statistics course by their gender is an example of what scale of
measurement?
A) Nominal
B) Ordinal
C) Interval
D) Ratio

Ans: A) Nominal
Q10. The volume of liquid in an unopened 1-gallon can of paint is an example of ____
Ans: a continuous random variable

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Q. The z score for the standard normal distribution

a. is always equal to zero
b. can never be negative
c. can be either negative or positive
d. is always equal to the mean
Ans: c. can be either negative or positive

Q12. The probabilities of both sample information and a particular state of nature occurring
simultaneously
Ans: joint probabilities
Q. one thing not true about the coefficient of correlation is that it
Ans: A. can be any number between -1 and +1.

Q13. SSE can never be

Ans: A. larger than SST

Q14. Abel Alonzo, Director of Human Resources, is exploring employee

absenteeism at the Plano Power Plant. Ten percent of all plant employees work in
the finishing department; 20% of all plant employees are absent excessively; and
7% of all plant employees work in the finishing department and are absent
excessively. A plant employee is selected randomly; F is the event "works in the
finishing department;" and A is the event "is absent excessively." What is the
probability that an employee that works in the finishing department is absent
excessively? ”
???
Q15. A simple random sample of 100 observations was taken from a large population. The sample mean
andthe standard deviation were determined to be 80 and 12 respectively. The standard error of the
mean is
a. 1.20
b. 0.12
c. 8.00
d. 0.80
Ans: A. 1.20

Q17. In order to determine whether or not a particular medication was effective

in curing the common cold, one group of patients was given the medication,
while another group received sugar pills. The results of the study are shown
below.
Patients Cured Patients Not Cured
Received medication 70 10
Received sugar pills 20 50
We are interested in determining whether or not the medication was effective
in curing the common cold. The value of the test statistic is

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a. 10.08
b. 54.02
c. 1.96
d. 1.645
Ans: B. 54.02
Q18. Four percent of the customers of a mortgage company default on their payments. A sample
of five customers is selected. What is the probability that exactly two customers in the sample
will default on their payments?
a. 0.2592
b. 0.0142
c. 0.9588
d. 0.7408
Ans: b. 0.0142

Q19. In a regression analysis if SSE = 200 and SSR = 300, then the coefficient of determination
is
Ans: 0.6000

Q20. The center of a normal curve is

a. always equal to zero
b. is the mean of the distribution
c. cannot be negative
d. is the standard deviation
Ans: b. is the mean of the distribution

Q21. What type of error occurs if you fail to reject H0 when, in fact, it is not true?
a. Type II
b. Type I
c. either Type I or Type II, depending on the level of significance
d. either Type I or Type II, depending on whether the test is one tail or two tail

Ans: a. Type II
Q22. The number of electrical outages in a city varies from day to day. Assume
that the number of electrical outages (x) in the city has the following
probability distribution.

x f(x)
0 0.80
1 0.15

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2 0.04
3 0.01

The mean and the standard deviation for the number of electrical outages
(respectively) are
Ans: b. 0.26 and 0.577
Q23. A survey in which customers taste five different brands of ice cream, and rank their
favorites from 1 to 5, would be an example of which type of scale of measurement?
A) nominal
B) ordinal
C) interval
D) ratio
E) mean
Ans: B) ordinal

Q24 . The variance of a sample of 169 observations equals 576. The standard deviation of the
sample equals
a. 13
b. 24
c. 576
d. 28,461
Ans: b. 24
Q25. The number of degrees of freedom for the appropriate chi-square distribution in a test of
independence is
a.
n-1
b.
K-1
c.
number of rows minus 1 times number of columns minus 1
d.
a chi-square distribution is not used
Ans: c. number of rows minus 1 times number of columns minus 1

Q26. The measure of location which is the most likely to be influenced by extreme values in the
data set is the

a. range
b. median
c. mode
d. mean
Ans: d. mean

Q27.
The degrees of freedom for a contingency table with 12 rows and 12 columns is

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a. 144
b. 121
c. 12
d. 120
Ans: B.121

Q28. An assumption made about the value of a population parameter is called a

a. hypothesis
b. conclusion
c. confidence
d. significance

Ans: a. hypothesis

Q29. The probability of one event given the known outcome of a (possibly) related event
Ans: conditional probabilities

Q. The relative frequency of a class is computed by

a.) dividing the midpoint of the class by the sample size
b.) dividing the frequency of the class by the midpoint
c.) dividing the sample size by the frequency of the class
d.) dividing the frequency of the class by the sample size
Ans: d.) dividing the frequency of the class by the sample size

Q30. In a regression analysis, the regression equation is given by y = 12 - 6x. If SSE = 510 and
SST = 1000, then the coefficient of correlation is
Ans: -0.7

Q. A tabular representation of the payoffs for a decision problem is a

a. decision tree
b. payoff table
c. matrix
d. sequential matrix

Ans: b. payoff table

Q31. If X is a binomial random variable with n=8 and p=0.2, the variance of X
is _____

Q32. the long-run average or mean of a Poisson distribution is usually referred to as

Q33. The probability of the states of nature, after use of Bayes' theorem to adjust the prior
probabilities
based upon given indicator information, is called
a. marginal probability
b. conditional probability

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c. posterior probability
d. None of these alternatives is correct.

Ans: conditional probability

Q34. In the following estimated regression equation Yhat=b0+b1x

Ans: b1 is the slope

Q35. In a regression analysis, the coefficient of determination is 0.4225. The coefficient of

correlation in this situation is
Ans: 0.65

Q36.
Assume that you have a binomial experiment with p = 0.5 and a sample size of 100.
The expected value of this distribution is
a. 0.50
b. 0.30
c. 100
d. 50

Ans: 50

Q37. The ages of students at a university are normally distributed with a mean
of 21. What percentage of the student body is at least 21 years old?
a. It could be any value, depending on the magnitude of the standard
deviation
b. 50%
c. 21%
d. 1.96%
b. 0.1303
Ans: b. 50%

Q38. If P(A) = 0.58, P(B) = 0.44, and P(A ∩ B) = 0.25, then P(A U B)=
Ans: 0.77

Q39. The amount of time a patient waits in a doctor's office is an example of___________
Ans: a continuous random variable

Q40. From a group of 12 students, we want to select a random saample of 4 students to serve on
a university committee. How many different random samples of 4 students can be selected?a. 48
b. 20,736
c. 16
d. 495

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Ans: d. 495

Q41. A group of students had dinner at a local restaurant. The total bill for the dinner was
$414.70. Each student paid his/her equal share of the bill, which was $18.85. How many
student's were at the dinner?

Ans: 22

Q42. Variables which take on values only at certain points over a given interval are called
Ans: B. continuous random variables

Q43. Z is a standard normal random variable. What is the value of Z if the area between -Z and Z
is 0.754?
a. 0.377
b. 0.123
c. 2.16
d. 1.16

Ans: d. 1.16

Q44. The relative frequency of a class is computed by

a.) dividing the midpoint of the class by the sample size
b.) dividing the frequency of the class by the midpoint
c.) dividing the sample size by the frequency of the class
d.) dividing the frequency of the class by the sample size
Ans: D dividing the frequency of the class by the sample size

Q45. A graphic presentation of the expected gain from the various options open to the decision maker
is
called
a. a payoff table
b. a decision tree
c. the expected opportunity loss
d. the expected value of perfect information
Ans: b. a decision tree

Q46. a tabular summary of data showing then number of data values in each of several non overlapping
classes
Ans: frequency distribution

Q47. he median of a sample will always equal the

Ans: 50th percentile

Q48. In computing the standard error of the mean, the finite population correction factor is used
when

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a. N/n > 0.05

b. N/n <_ 0.05
c. n/N > 0.05
d. n/N <_ 30
Ans: c. n/N > 0.05

Q49. In a regression and correlation analysis if r2 = 1, then

a. SSE = SST
b. SSE = 1
c. SSR = SSE
d. SSR = SST

Ans: d. SSR = SST

Q50. The variance for the binomial probability distribution is

a. var(x) = P(1 - P)
b. var(x) = nP
c. var(x) = n(1 - P)
d. var(x) = nP(1 - P)
Ans: d. var(x) = nP(1 - P)

Q51. If the coefficient of determination is equal to 1, then the coefficient of correlation

Ans: can be either -1 or +1

Q52.
In a regression analysis if SST = 500 and SSE = 300, then the coefficient of
determination is
a. 0.20
b. 1.67
c. 0.60
d. 0.40

Ans: d. 0.40

Q53. For a decision alternative, the weighted average of the payoffs is known as
a. the expected value of perfect information
b. the expected value
c. the expected probability
d. perfect information

Ans: the expected value

Q54. A survey of 800 college seniors resulted in the following cross-tabulation

regarding their undergraduate major and whether or not they plan to go to

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graduate school.

Undergraduate Major
Graduate School Business Engineering Others Total
Yes 70 84 126 280
No 182 208 130 520
Total 252 292 256 800
Ans: 65

Q55. The value of the coefficient of correlation (R)

Ans: can be equal to the value of the coefficient of determination (R2)

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calDivis
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s
le
a din gas t
udytoident
if
ya ndasses
stherel
at
iv
eimpor t
anceofproductf
eat
ures
.Ma nueldi
rec
ts
hiss t
a fftodes
ignasurveyquest
ionnai
reanddi
str
ibut
ionitt
oa l
lofPlano’
s954c us
tomers.
Ma nue li
sorderi
nga____________.
a)st
ati
sti
cfromt hec ust
ome r
s
b)censusofthecus tome rs
c)sampleofthec ustome rs
d)sort
ingofthec ustome rs
e)para
me t
erofthec us t
omers

Ans
:b.s
ampl
eoft
hec
ust
ome
rs

Q58.Jessi
caSal
as,pres
identofSa
lasProduct
s,i
srevi
ewingthewa r
rantypol
ic
yforher
company'
snewmode lofautomobi
lebatte
rie
s.Lifete
stsperf
ormedonas ampleof100bat
ter
ies
i
ndicat
edanaver
ag eli
feofseveny
earsundernor
ma lusage
.Jess
icarecommendedasix-
yea
r
warran
typeri
odforthenewmode l
.Thisisanexampleof_____________.
a)descri
pti
vest
a t
is
ti
cs
b)execut
ivefor
ecast
ing
c)populat
ionderi
vati
on

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 lOMoARcPSD|9757382

d
)samplepe
rsuas
ion
e
)inf
ere
nti
alst
ati
sti
cs

Ans
:e.i
nfe
rent
ials
tat
is
ti
cs

Q59.AbelAlonzo,Direct
orofHuma nRe sour
ces,ise
xplori
ngthecaus
esofempl o
yee
abse
nte
e i
smatBa t
esvil
leBo tt
li
ngduri
ngthelastoper
ati
ngy e
ar(Ja
nuary1,1999through
December31,1999).Forthisst
udythesetofal
le mpl
oyeeswhowor ke
datBa t
esvi
lleBott
li
ng
duri
ngthela
stopera
t i
ngye a
ris_________.
a)apar
ame t
er
b)asa
mpl e
c)t
hepopulat
ion
d)ast
ati
st
ic
e)t
hefra
me

Ans
:c.t
hepopul
ati
on

Q60.Ama rketre
searc
heri
sint
erest
edindeter
miningt
heave
rageinc
omeforfamil
ie
sinDu va
l
County
,Flor
ida.Toa c
compl
ishthi
s,shet
akesarandomsampleof400fa
mili
esfr
om thecount
y
andusest
heda t
ag a
ther
edfr
omt hemtoesti
ma t
etheav
era
geincomeforf
amil
iesoftheent
ir
e
count
y.Thisproces
sisanexampleof_______.
a) nonparametric statistics

b)nominaldat
a
c)desc
ript
ivest
ati
st
ic
s
d)inf
erent
ials
tat
is
ti
cs
e
)ce
nsus

Ans
:d.i
nfe
rent
ials
tat
is
ti
cs

Q61. Je
ssic
aSalas,pre
sidentofSa
lasProduct
s,isre
vie
wingthewa r
rantypol
ic
yforher
compa n
y '
snewmode lofautomobil
ebatter
ies
.Li f
etes
tsperf
ormedonas ampleof100bat
ter
ies
indi
catedanaver
ag eli
feofsevenye
arsundernormalusage
.Jess
icarecommendedasix-
yea
r
wa r
rant
ype r
iodforthenewmode l
.Thisisane x
a mpl
eof_____________.
a)descri
pti
vestat
ist
ics
b)executi
veforec
asti
ng
c)populat
ionderiv
ati
on
d)samplepersuasi
on
e)inf
erent
ialst
ati
sti
cs

Ans
:e.i
nfe
rent
ials
tat
is
ti
cs

Q62.Anews a
lesper
sonispai
dac ommis
siononea
chsa
le.Thi
sper
sonmade$2,000hi
sfir
st
monthonthej
ob.Fromthisheconcl
ude
sthathewi
llma
ke$24,
000dur
inghi
sfir
styea
r.Thisi
s
anexampl
eof_______.

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 lOMoARcPSD|9757382

a) inferential statistics
b)nomi nalda ta
c
)de
scr
ipt
iv
estat
is
tic
s
d
)de
fer
ent
ials
tat
is
ti
cs
)nonparametric statistics
e

Ans
:a.inferential statistics
Q63.Ama rke tre
searcheri
sinte
rest
edindeter
miningt
heave
rageincomeforf
a mil
ie
sinDu val
Count y,Fl or i
da .Toa c
c ompl
ishthi
s,shet
akesarandomsampleof400f a
mil
iesfr
om thecount
y
andu sestheda t
agatheredfr
omt hemtoesti
ma t
etheav
era
geincomef orf
amil
iesoftheent
ir
e
coun ty.Thi spr oces
sisa nexampleof_______.
a) nonparametric statistics

b)nominaldat
a
c)desc
ript
ivest
ati
st
ic
s
d)inf
erent
ials
tat
is
ti
cs
e
)ce
nsus

Ans
:d.i
nfe
rent
ials
tat
is
ti
cs

Q64. Ma nuelBanale
s,Ma r
keti
ngDi r
ect
orofPla
noPo werPla
nts,Inc.
'
sElectr
ica
lDivis
ion,is
le
a din gas t
udytoident
if
ya ndasses
stherel
at
iv
eimpor t
anceofproductf
eatur
es.Ma nueldir
ect
s
hiss t
a fftodes
ignasurveyquest
ionnai
reanddi
str
ibut
eitto100ofPl a
no’s954cust
ome r
s .
Ma nue li
sorderi
nga____________.
a)st
ati
sti
cfromt hec ust
ome r
s
b)censusofthecus tome rs
c)sampleofthec ustome rs
d)sort
ingofthec ustome rs
e)para
me t
erofthec us t
omers

Ans
:c.s
ampl
eoft
hec
ust
ome
rs

Q63.Ar esearc
herwant
stoknowwha ttheav
eragev aria
ti
oni sinalt
ime t
e r
sofs ma l
l,pri
vatel
y
owne da ir
planes
.Thetas
kofde t
erminingthi
sisexpe nsi
veandt imecons uming ,i
fev e
npos si
ble
,
giventhel ar
genumberofsuchair
planes.Theresearcherdec i
destous egovernme ntrecordst
o
randoml ylocat
etheownersoft
ens uchplane
sandt he ngetpermissi
ont otestthealt
ime te
rs.
Whe nt heresear
cheri
sdone,hewillusethedat
ag atheredfrom thegroupoft entor each
conclusionsaboutal
lsmall
,pri
vat
elyo wnedair
planes.Thispr oces
scanbe stbede scri
beda s
_______.
a)dat
ast
ati
st
ic
s
b)re
sear
chst
atis
tics

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 lOMoARcPSD|9757382

c
)descr
ipt
ivest
ati
st
ic
s
d
)inf
erent
ials
tat
is
ti
cs
e
)nonpara
me t
ri
cstat
is
ti
cs

Ans
:d.i
nfe
rent
ials
tat
is
ti
cs

Q64.The following box and whisker plot was constructed for the age of accounts receivable.

The box and whisker plot reveals that the accounts receivable ages are _______.
a) skewed to the left
b) skewed to the right
c) not skewed
d) normally distributed
e) symmetrical

Ans: b. skewed to the right

Q66. A survey of a sample of business students resulted in the following information regarding the
genders of the individuals and their selected major.

Selected Major

Gender Management Marketing Others Total

Male 40 10 30 80

Female 30 20 70 120

Total 70 30 100 200

a. What is the probability of selecting an individual who is majoring in Marketing?

b What is the probability of selecting an individual who is majoring in Management, given that the
. person is female?
c. Given that a person is male, what is the probability that he is majoring in Management?
d What is the probability of selecting a male individual?
.

ANS:

a. 0.15
b. 0.25

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c. 0.50
d. 0.40

Q67. The following frequency distribution was constructed for the age of accounts receivable.

The frequency distribution reveals that the accounts receivable ages are _______.
a) skewed to the left
b) skewed to the right
c) not skewed
d) normally distributed
e) symmetrical

Ans: b. skewed to the right

Q. given p (a) = 0.40 p (b) = 0.50 p (a ∩b) = 0.15. find P(B|A)

0.80
0.20
0.375
0.30
Ans: 0.375

 Consider the following frequency distribution:-

What is the relative frequency of the first class?

(a) 0.15
(b) 0.30
(c) 0.10
(d) None of the above
Ans: 0.30

Q. if x is a binomial random variable with n 8 and p 0.2 the variance of x is

a. 0.96
b. 4

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c. 1.28
d. 6
ANS: 1.28
Q. A statistics student made the following grades on 5 tests: 84, 78, 88, 78, and 72. What is the
mean grade?
a) 78
b) 80
c) 72
d) 84
e) 88

Ans: b. 80

Q. A statistics instructor collects information about the background of his students. About
30% have taken economics and about 40% have taken accounting. There are 23 male
students and 27 female students in this class. This is an example
of(a)____________________.
○ Descriptive statistics
○ Inferential statistics
○ Nominal data
○ Nonparametric statistics
Ans: Nominal data

Q. The error that occurs because a sample, and not the entire population, is
used to. estimate apopulation parameter is a.
a. nonsampling error.
b. sampling error
Ans: . sampling error

Q. Q. Below you are given a payoff table involving three states of nature and two decision
alternatives.

Decision
Alternative States of Nature
S1 S2 S3
A 80 45
B 40 50
The probability that S1 will occur is 0.1; the probability that S2 will occur is 0.6,
The expected value of perfect information equals
a. 12
b. 4
c. 37
d. 29
Ans: b. 4

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The number of degrees of freedom for the appropriate chi-square distribution in a test of
independence is
a. n-1
b. K-1
c. number of rows minus 1 times number of columns minus 1
d. a chi-square distribution is not used
Ans: C. number of rows minus 1 times number of columns minus 1

Q. Regression was used to develop a model to predict sales based on advertising dollars spent. The equation
developed is Y = 1000 + 20X, where X is advertising dollars and Y is sales. If $300 is spent on
advertising, what would be the best prediction for sales?

(a) $1,600
(b) $7,000
(c) $1,620
(d) $6,000
(e) none of the above
Ans. A. $1,600
Q. If X is a binomial random with n=8 and p=0.6, what is the probability that X is equal to 5?

A. 0.625
B. 0.279
C. 0.209
D. 0.300
Ans: 0.279

Q. if A and B are mutually exclusive events and the probability of event A is 0.2 and b is 0.8 then
what is the probability of A intersection B
a. 1.0
b. 0.5
c. 0.6
d. None of the Above
Ans: None of the Above

Q. Using the data below, approximately what percentage of students buy either hot dogs or hamburgers
from the cafeteria at lunch?

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a. 65%
b. 26%
c. 29%
d. 75%
Ans: b.26%

Q. The total area underneath any normal curve is ______.

a) Equal to the mean
b) Equal to 1
c) Equal to the variance
d) Equal to the coefficient of variation

Ans: Equal to 1

Q. Inorder to determine whether or not a particular medication was effective in

curing the common cold, one group of patients was given the medication,
while another group received sugar pills. The results of the study are shown
below.
Patients Cured Patients Not Cured
Received medication 70 10
Received sugar pills 20 50

a. 70
b. 50
c. 28
d. 48
Ans: d. 48

Q. a standard normal distribution, the probability of obtaining a z value between -2.4 to

-2.0 is

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a. 0.4000
b. 0.0416
c. 0.0400
d. 0.5000
Ans: 0.0416
Q. You are offered an investment opportunity. Its outcomes and probabilities are presented in the following
table.

-$1,000
.40
$0
.20
+$1,000
.40
The mean of this distribution is _____________.
1. -$400
2. $0
3. $200
4. $400
Ans: $0
Q. An automobile dealer wishes to investigate the relation between the gender of the buyer
and type of vehicle purchased. The following joint probability table was developed from the
dealer's records for the previous year: -

P(Male) = (a)____________________.

(a) 0.48 (b) 0.20 (c) 0.50 (d) 0.02

Ans: (c) 0.50

Q. Which of the following Circle Graphs best displays the data that is shown in the table
below?

a) A b) B c) C d) D

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Ans: c) C
Q. State whether the following question provided is qualitative or quantitative data and
indicates the measurement scale appropriate - What is your age?
a. Qualitative, ratio b. Quantitative, ratio c. Qualitative, nominal

d.Quantitative, ordinal

Ans: b. Quantitative, ratio

Q. If P(A) = 0.50, P(B) = 0.60, and P(A B) = 0.30, then events A and B are
a. mutually exclusive events b. not independent events c. independent events
d. not enough information is given to answer this question

Ans: c. independent events

Q. The number of electrical outages in a city varies from day to day. Assume that the number of
electrical outages (x) in the city has the following probability distribution.

X f(x)

0 0.80

1 0.15

2 0.04

3 0.01

The mean and the standard deviation for the number of electrical outages (respectively) are

a.2.6 and 5.77 b.0.26 and 0.577 c.3 and 0.01 d.0 and 0.8

Ans. b. 0.26 and 0.577

Q. Z is a standard normal random variable. What is the value of Z if the area to the right of Z is
0.9803?

a.-2.06, b.0.4803 c.0.0997 d.3.06

Ans. a. -2.06

1. Q. The hourly wages of a sample of 130 system analysts are given below.

mean = 60 range = 20

mode = 73 variance = 324

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median = 74

The coefficient of variation equals

a. 0.30%
b. 30%
c. 5.4%
d. 54%
Ans. b. 30%

Q. Given P(A) = 0.40, P(B) = 0.50, P(A ∩ B) = 0.15. Find P(B|A).

(a) 0.80 (b) 0.20 (c) 0.375 (d) 0.30

Ans: (c) 0.375

Q. The coefficient of correlation ranges between

1. 0 and 1
2. -1 and +1
3. minus infinity and plus infinity
4. 1 and 100
Ans. b. -1 and +1

2. Q. Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the following
performance statistics for two new stocks: -

The coefficient of variation for Salas Products, Inc. is ______.

(a) 300% (b) 33% (c) 5% (d) 100%

--------------------------------------------------------------------- X 408 mcq X ----------------------------------------------------

QMM Formulas
Mode = 3 * Median - 2 * Mean

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Coefficient of variation C.V = 100* / μ

Coefficient of skewness z-Scores

Chebyshev’s Theorem
At least (1 - 1/z ) of the items in any data set will be within z standard deviations
2

of the mean, where z is any value greater than 1.

Box Plot
Lower Limit: Q1 - 1.5(IQR) Upper Limit: Q3 + 1.5(IQR) where IQR =
Q3- Q1

Weighted Mean Mean for grouped data

M = midpoint of class i
i

Median of Grouped Data

Variance and Standard Deviation of Grouped Data

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For bell shaped curve

% of values are within % of values

1 68.26%
2 95.44%
3 99.72%

Covariance

Correlation coefficient

Simple Regression Model

Least Squares method

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Coefficient of Determination
r = SSR / SST
2
Perfect fit : SSR= SST

where: SST = total sum of squares SSR = sum of squares due to regression SSE = sum of
squares due to error

Sample Correlation Coefficient

Where b = the slope of the estimated regression equation

1

Probability

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Classical prob Relative freq prob

Either “or” probability

P(AUB) = P(A) +P(B) – P(A∩B)

Intersection & Independent

for dependent events

for independent events,

P(A intersection B) = P(A) . P(B)

Conditional prob

Bayes’ Rule

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Discrete Random variable

μ = E (X) = ∑ X.P(X)
= ∑ (X .P(X)) – (∑ X.P(X) )
2 2 2

Binomial Distribution

Poisson Distribution

λ: The variance of the Poisson is also equal to its mean and it is equal to np
Standard deviation: √λ

Conditions where binomial probabilities may be approximated by Poisson

probabilities

Normal Distribution Z~ N(0,1 ) 2

Conditions where binomial probabilities may be approximated by normal

probabilities
interval μ ± 3 should lie between 0 and n

binomial to poisson conversion

Sampling Distribution

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For infinite population

Standard Error = Standard Deviation of distribution = / √n

For finite population

Standard Error = Standard Deviation of distribution = ( / √n ) * (√ (N-n) / (N-1) )

The Sampling Distribution can be approximated to the Normal Distribution

o When n ≥ 30 it follows the ‘z’ distribution
o When n < 30, it is approximated to the ‘t’ distribution
 SNV(X) = (X - μ) / σx ’

 σx= σ/√n

Standard Error of proportion

For infinite population, √ pq/n For finite population, (√ pq/n ) * (√ (N-n) / (N-1) )

Central Limit theorem, For large enough n:

Interval Estimation
For n > 30 μ Є [ ± Z SE() ] where SE() = / √n
α/2

reverse search in z-table for Z α/2 value of 0.5 – (α / 2)

when alpha = 0.05, Z – value = 0.4750 in 0 to z table, whose z-index = 1.96

For n < 30 μ Є [ ± t α/2 (n-1)df SE() ] where SE() = s / √n

For proportion
∏ Є [ p ± Z SE(p) ] where SE(p) = √ pq / n
α/2

Hypothesis
Classical
To accept H0, Table value > calculated value
P value
To accept H0, p value > alpha (for 2 tail test, to accept H0, p value > alpha /2)

Chi Square- calculated value

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Where the expected frequency

Chi Square- table value

Degree of freedom = (n – 1) for single dimension
Degree of freedom = (r– 1) (c-1) for 2 dimensions

------------------------------------------------------- X formulas X ----------------------------

MODEL QUESTION PAPER- QUANTITATIVE METHODS FOR MANAGEMENT

1. State whether the following question provided is qualitative or quantitative data and indicate
the measurement scale appropriate -Are you a male or female?
a. Qualitative, ratio
b. Quantitative, ratio
c. Qualitative, nominal
d. Quantitative, ordinal
Ans: Qualitative, Nominal
2. State whether the following question provided is qualitative or quantitative data and indicate
the measurement scale appropriate - How long have you been in your present job or position
a. Qualitative, ratio, b. Quantitative, ratio, c. Qualitative, nominal, d. Quantitative, ordinal
Ans. d. Quantitative, ordinal
3. What is the median of the following set of numbers? {12,8,13,4,7,6,3,3,15}
a) 12 b) 8 c) 7 d) 7.5
Ans: C. 7
4. The hourly wages of a sample of 130 system analysts are given below.
mean = 60, range = 20, mode = 73, variance = 324, median = 74
The coefficient of variation equals
a. 0.30%, b.30%, c. 5.4%, d.54%

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Ans: b. 30% [formula: CV=SD/mean*100, SD= square root of variance]

5. The variance of a sample of 169 observations equals 576. The standard deviation of the
sample equals
a.13, b.24, c.576, d.28,461
Ans: b.24
6. The median of a sample will always equal the
a. mode, b. Mean, c. 50th percentile, d. All the above answers are correct
Ans. C. 50 percentile
th

7. A sample selected in such a manner that each sample of size n has the same probability of
being selected is
a. a convenience sample, b. a judgment sample, c. no probabilistic sampling, d. a simple random
sample
Ans. D. A simple random sample
8. Which of the following sampling methods is a probabilistic sampling method?
a. judgment sampling, b. convenience sampling, c. cluster sampling d. None of these
alternatives is correct.
Ans. C. Clustering Sampling
9. An uncertain future event affecting the consequence, or payoff, associated with a decision is
known as
a. unconditional probability, b. unknown probability, c. Chance event, d. uncertain probability
Ans. C. Chance Event
10. Nodes indicating points where a decision is made are known as
a. decision nodes, b. Chance nodes, c. marginal nodes, d. conditional nodes
Ans. a. decision nodes
11. In computing an expected value (EV), the weights are
a. decision alternative probabilities, b. in pounds or some unit of weight, c. in dollars or some
units of currency, d. the state-of-nature probabilities
Ans. d. the state-of-nature probabilities
12. Below you are given a payoff table involving three states of nature and two decision
alternatives.
Decision

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Alternative States of Nature

S1 S2 S3
A 80 45 -20
B 40 50 15
The probability that S1 will occur is 0.1; the probability that S2 will occur is 0.6. The
recommended decision based on the expected value criterion is
a. A, b. B, c. Both alternatives are the same, d. None of these alternatives is correct.
Ans. b. B
13. The degrees of freedom for a contingency table with 6 rows and 3 columns is
a. 18, b. 15, c.6, d.10
Ans. d.10. Explanation [(row-1) * (Column-1)] = 5*2 =10
14. If the coefficient of determination is a positive value, then the coefficient of correlation
a. must also be positive, b. must be zero, c. can be either negative or positive, d. must be larger
than 1
Ans. C. can be either negative or positive
15. Regression analysis is a statistical procedure for developing a mathematical equation that
describes how
a. one independent and one or more dependent variables are related
b. several independent and several dependent variables are related
c. one dependent and one or more independent variables are related
d. None of these alternatives is correct.
Ans. C. One dependent and one or more independent variables are related
16. Given below are five observations collected in a regression study on two variables x
(independent variable) and y (dependent variable). Develop the least squares estimated
regression equation
X Y
1 7
0
2 5
0
3 4
0
4 2
0
5 1

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0
a. Y = 8.3-0.15x
b. Y= 9+0.15x
c. Y= 8.3+0.15x
d. 9-0.15x
Ans. a. Y = 8.3-0.15x
17. As the sample size increases, the margin of error
a. increases, b. decreases, c. stays the same, d. Increases or decreases depending on the size of
the mean
Ans. b. decreases,
18. In computing the standard error of the mean, the finite population correction factor is used
when
a. N/n > 0.05, b. N/n 0.05, c. n/N > 0.05 d. n/N 30
Ans. c. n/N > 0.05
19. Z is a standard normal random variable. What is the value of Z if the area to the right of Z is
0.9803?
a. -2.06, b. 0.4803 c. 0.0997 d.3.06
Ans. a. -2.06
20. For a standard normal distribution, the probability of obtaining a z value between -2.4 to
-2.0 is
a. 0.4000, b. 0.0146, c.0.0400, d.0.5000
Ans. b. 0.0146
21. For a standard normal distribution, the probability of obtaining a z value of less than 1.6 is
a. 0.1600 b. 0.0160 c. 0.0016 d. 0.9452
Ans. d. 0.9452
22. The number of electrical outages in a city varies from day to day. Assume that the number of
electrical outages (x) in the city has the following probability distribution.
X f(x)
0 0.80
1 0.15
2 0.04

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3 0.01
The mean and the standard deviation for the number of electrical outages (respectively) are
a. 2.6 and 5.77 b. 0.26 and 0.577 c. 3 and 0.01 d. 0 and 0.8
Ans. b. 0.26 and 0.577
23. Assume that you have a binomial experiment with p = 0.4 and a sample size of 50. The
variance of this distribution is
a. 20 b. 12 c. 3.46 d. 144
Ans. b. 12 [Formula for variance is NP(1-P)]
24. In a binomial experiment the probability of success is 0.06. What is the probability of two
successes in seven trials?
a. 0.0036 b. 0.0600 c. 0.0555 d. 0.2800
Ans. c. 0.0555
25. If P(A) = 0.62, P(B) = 0.47, and P(A ∩ B) = 0.88, then P(A U B) =
a. 0.2914 b. 1.9700 c. 0.6700 d. 0.2100
Ans. d. 0.2100 (Formula P(A U B) = P(A) + P(B) - P(A ∩ B))
1. When the smallest and largest percentage of items are removed from a data set and the
mean is computed, the mean of the remaining data is
a. the median
b. the mode
c. the trimmed mean
d. any of the above
Ans. c. the trimmed mean
2. Which of the following is a measure of dispersion?
a. percentiles
b. quartiles
c. interquartile range
d. all of the above are measures of dispersion
Ans. c. interquartile range
3. The first quartile
a. contains at least one third of the data elements

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b. is the same as the 25th percentile

c. is the same as the 50th percentile
d. is the same as the 75th percentile
Ans. b. is the same as the 25th percentile
4. The 50th percentile is the
a. mode
b. median
c. mean
d. third quartile or
Ans. b. median

5. If two groups of numbers have the same mean, then

a. their standard deviations must also be equal
b. their medians must also be equal
c. their modes must also be equal
d. None of these alternatives is correct.
Ans. d. None of these alternatives is correct.
6. The symbol σ is used to represent
a. the variance of the population
b. the standard deviation of the sample
c. the standard deviation of the population
d. the variance of the sample
Ans. c. the standard deviation of the population
7. The interquartile range is
a. the 50th percentile
b. another name for the variance
c. the difference between the largest and smallest values
d. the difference between the third quartile and the first quartile

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Ans. d. the difference between the third quartile and the first quartile
8. The heights (in inches) of 25 individuals were recorded and the following statistics were
calculated
mean = 70 range = 20
mode = 73 variance = 784
median = 74
The coefficient of variation equals
a. 11.2%
b. 1120%
c. 0.4%
d. 40%
Ans. d. 40%
9. The variance of the sample
a. can never be negative
b. can be negative
c. cannot be zero
d. cannot be less than one
Ans. a. can never be negative
10. A numerical value used as a summary measure for a sample, such as sample mean, is
known as a
a. population parameter
b. sample parameter
c. sample statistic
d. population mean
Ans. c. sample statistic
11. Positive values of covariance indicate
a. a positive variance of the x values
b. a positive variance of the y values
c. the standard deviation is positive
d. positive relation between the independent and the dependent variables
Ans. d. positive relation between the independent and the dependent variables
12. If a data set has an even number of observations, the median
a. cannot be determined
b. is the average value of the two middle items?
c. must be equal to the mean
d. is the average value of the two middle items when all items are arranged in
ascending order?

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Ans. d. is the average value of the two middle items when all items are arranged in
ascending order
13. The variance can never be
a. zero
b. larger than the standard deviation
c. negative
d. smaller than the standard deviation
Ans. c. negative

14. Which of the following provides a measure of central location for the data?
a. standard deviation
b. mean
c. variance
d. range
Ans. b. mean
15. The weights (in pounds) of a sample of 36 individuals were recorded and the following
statistics were calculated.
mean = 160 range = 60
mode = 165 variance = 324
median = 170
The coefficient of variation equals
a. 0.1125%
b. 11.25%
c. 203.12%
d. 0.20312%
Ans. b. 11.25%
16. If index i (which is used to determine the location of the pth percentile) is not an integer, its
value should be
a. squared
b. divided by (n - 1)
c. rounded down
d. rounded up
Ans. d. rounded up
17. Which of the following symbols represents the size of the sample
a. σ2

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b. σ
c. N
d. n
Ans. d. n

18. The mean of the sample

a. is always smaller than the mean of the population from which the sample was taken
b. can never be zero
c. can never be negative
d. None of these alternatives is correct.
Ans. d. None of these alternatives is correct.
19. The interquartile range is
a. the 50th percentile
b. another name for the variance
c. the difference between the largest and smallest values
d. the difference between the third quartile and the first quartile
Ans. d. the difference between the third quartile and the first quartile
20. The coefficient of variation is
a. the same as the variance
b. the standard deviation divided by the mean times 100
c. the square of the standard deviation
d. the mean divided by the standard deviation
Ans. b. the standard deviation divided by the mean times 100
21. Since the population is always larger than the sample, the value of the sample mean

1. is always smaller than the true value of the population mean

2. is always larger than the true value of the population mean
3. is always equal to the true value of the population mean
4. could be larger, equal to, or smaller than the true value of the population mean

Ans. d. could be larger, equal to, or smaller than the true value of the population mean

22. The hourly wages of a sample of 130 system analysts are given below.
mean = 60 range = 20
mode = 73 variance = 324
median = 74

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The coefficient of variation equals

a. 0.30%
b. 30%
c. 5.4%
d. 54%
Ans. b. 30%
23. When computing the mean, the smallest value

1. can never be negative

2. can never be zero
3. can never be less than the mean
4. can be any value
Ans. d. can be any value
24. The value which has half of the observations above it and half the observations below it
is called the
a. range
b. median
c. mean
d. mode
Ans. b. median
25. When should measures of location and dispersion be computed from grouped data
rather than from individual data values?

1. as much as possible since computations are easier

2. only when individual data values are unavailable
3. whenever computer packages for descriptive statistics are unavailable
4. only when the data are from a population
Ans. b. only when individual data values are unavailable
26. A numerical measure of linear association between two variables is the
a. variance
b. covariance
c. standard deviation
d. coefficient of variation
Ans. b. covariance
27. The most frequently occurring value of a data set is called the
a. range
b. mode
c. mean

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d. median
Ans. b. mode

28. μ is an example of a
a. population parameter
b. sample statistic
c. population variance
d. mode
Ans. a. population parameter
29. The variance of a sample of 169 observations equals 576. The standard deviation of the
sample equals
a. 13
b. 24
c. 576
d. 28,461
Ans. b. 24
30. The variance of a sample of 81 observations equals 64. The standard deviation of the
sample equals
a. 9
b. 4096
c. 8
d. 6561
Ans. C. 8
31. Which of the following is not a measure of dispersion?
a. the range
b. the 50 percentile
th

c. the standard deviation

d. the interquartile range
Ans. b. the 50 percentile
th

32. The median is a measure of

a. relative dispersion
b. absolute dispersion
c. central location
d. relative location
Ans. C. Central Location
33. Since the population size is always larger than the sample size, then the sample statistic
a. can never be larger than the population parameter
b. can never be equal to the population parameter

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c. can be smaller, larger, or equal to the population parameter

d. can never be smaller than the population parameter
Ans. c. can be smaller, larger, or equal to the population parameter
34. The sum of deviations of the individual data elements from their mean is
1. always greater than zero
2. always less than zero
3. sometimes greater than and sometimes less than zero, depending on the data
elements
4. always equal to zero
Ans. always equal to zero
35. The most important statistical descriptive measure of the location of a data set is the
a. mean
b. median
c. mode
d. variance
Ans. a. mean
36. A numerical measure of linear association between two variables is the
a. variance
b. coefficient of variation
c. correlation coefficient
d. standard deviation
Ans. c. correlation coefficient
37. The pth percentile is a value such that at least p percent of the observations are
a. less than or equal to this value
b. less than this value
c. more than or equal to this value
d. more than this value
Ans. a. less than or equal to this value

38. The mean of a sample

a. is always equal to the mean of the population
b. is always smaller than the mean of the population
c. is computed by summing the data values and dividing the sum by (n - 1)
d. is computed by summing all the data values and dividing the sum by the number
of items
Ans. d. is computed by summing all the data values and dividing the sum by the
number of items

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39. The measure of location which is the most likely to be influenced by extreme values in
the data set is the
a. range
b. median
c. mode
d. mean
Ans. d. mean
40. The 75th percentile is referred to as the
a. first quartile
b. second quartile
c. third quartile
d. fourth quartile
Ans. c. third quartile
41. The first quartile
a. contains at least one third of the data elements
b. is the same as the 25th percentile
c. is the same as the 50th percentile
d. is the same as the 75th percentile
Ans. b. is the same as the 25th percentile
42. In computing descriptive statistics from grouped data,
a. data values are treated as if they occur at the midpoint of a class
b. the grouped data result is more accurate than the ungrouped result
c. the grouped data computations are used only when a population is being analyzed
d. None of these alternatives is correct
Ans. a. data values are treated as if they occur at the midpoint of a class
43. When computing the mean of a set of values xi, the value of ∑xi
a. can never be zero
b. can never be negative
c. must always be positive
d. can be any value
Ans. a. can be any value
44. When data are positively skewed, the mean will usually be
a. greater than the median
b. smaller than the median
c. equal to the median
d. positive
Ans. a. greater than the median

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45. The median of a sample will always equal the

a. mode
b. mean
c. 50th percentile
d. all of the above answers are correct
Ans. 50 percentile
th

46. When data are positively skewed, the mean will usually be
a. greater than the median
b. smaller than the median
c. equal to the median
d. positive
Ans. a. greater than the median
47. The difference between the largest and the smallest data values is the
a. variance
b. interquartile range
c. range
d. coefficient of variation
Ans. c. range
48. The coefficient of correlation
a. is the same as the coefficient of determination
b. can be larger than 1
c. cannot be larger than 1
d. cannot be negative
Ans. Cannot be larger than 1
49. The sample variance
a. is always smaller than the true value of the population variance
b. is always larger than the true value of the population variance
c. could be smaller, equal to, or larger than the true value of the population
variance
d. can never be zero
Ans. c. could be smaller, equal to, or larger than the true value of the population
variance
50. The coefficient of correlation ranges between
a. 0 and 1
b. -1 and +1
c. minus infinity and plus infinity
d. 1 and 100
Ans. b. -1 and +1

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51. The numerical value of the standard deviation can never be

a. larger than the variance
b. zero
c. negative
d. smaller than the variance
Ans. c. Negative
52. When the data are skewed to the right, the measure of Skewness will be
a. negative
b. zero
c. positive
d. one
Ans. c. Positive
53. The symbol σ2 is used to represent
a. the variance of the population
b. the standard deviation of the sample
c. the standard deviation of the population
d. the variance of the sample
Ans. a. the variance of population
54. Which of the following is not a measure of central location?
a. mean
b. median
c. variance
d. mode
Ans. c. Variance
55. The standard deviation of a sample of 100 observations equals 64. The variance of the
sample equals
a. 8
b. 10
c. 6400
d. 4,096
Ans. d. 4096
56. The interquartile range is used as a measure of variability to overcome what difficulty of
the range?
a. the sum of the range variances is zero
b. the range is difficult to compute
c. the range is influenced too much by extreme values
d. the range is negative
Ans. c. the range is influenced too much by extreme values

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57. If the variance of a data set is correctly computed with the formula using n - 1 in the
denominator, which of the following is true?
a. the data set is a sample
b. the data set is a population
c. the data set could be either a sample or a population
d. the data set is from a census
Ans. a. the data set is a sample
58. The measure of dispersion that is influenced most by extreme values is
a. the variance
b. the standard deviation
c. the range
d. the interquartile range
Ans. c. the range
59. The descriptive measure of dispersion that is based on the concept of a deviation about
the mean is
a. the range
b. the interquartile range
c. the absolute value of the range
d. the standard deviation
Ans. a. the standard deviation
60. The measure of dispersion which is not measured in the same units as the original data
is the
a. median
b. standard deviation
c. coefficient of determination
d. variance
Ans. d. variance
61. The numerical value of the variance
a. is always larger than the numerical value of the standard deviation
b. is always smaller than the numerical value of the standard deviation
c. is negative if the mean is negative
d. can be larger or smaller than the numerical value of the standard deviation
Ans. d. can be larger or smaller than the numerical value of the standard deviation
62. Consider the following frequency distribution:
What is the relative frequency of the first class?
(a) 0.15 (b) 0.30 (c) 0.10 (d) None of the above

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63. A statistics student made the following grades on 5 tests: 84, 78, 88, 78, and 72. What is
the mean grade?
(a) 84 (b) 72 (c) 80 (d) 78

64. Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the following
performance statistics for two new stocks: -
The coefficient of variation for Salas Products, Inc. is ______.
(a) 300% (b) 33% (c) 5% (d) 100%

65. Let A be the event that a student is enrolled in an accounting course and let S be the
event that a student is enrolled in a statistics course. It is known that 30% of all students
are enrolled in an accounting course and 40% of all students are enrolled in statistics.
Included in these numbers are 15% who are enrolled in both statistics and accounting.
Find P(S).

(a) 0.30 (b) 0.55 (c) 0.15 (d) 0.40

66. Given P(A) = 0.40, P(B) = 0.50, P(A ∩ B) = 0.15. Find P(B|A).
(a) 0.80 (b) 0.20 (c) 0.375 (d) 0.30
67. An automobile dealer wishes to investigate the relation between the gender of the
buyer and type of vehicle purchased. The following joint probability table was developed
from the dealer's records for the previous year: -

P(Male) = (a)____________________.

(a) 0.48 (b) 0.20 (c) 0.50 (d) 0.02

68. Variables which take on values only at certain points over a given interval are
called(a)____________________.
(a) Value variables (b) Continuous random variables (c) Point variables
(d) Discrete random variables

69. The volume of liquid in an unopened 12-ounce bottle of beer is an example of

____________________.

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(a) A discrete random variable (b) The binomial distribution (c) The normal distribution
(d) A continuous random variable

70. You are offered an investment opportunity. Its outcomes and probabilities are presented
in the following table: -
The mean of this distribution is (a)____________________.

(a) $400 (b) -$400 (c) $200 (d) $0

71. If x is a binomial random variable with n=10 and p=0.4, the mean of x
is(a)____________________.

(a) 4 (b) 2.4 (c) 6 (d) 10

72. The variance of a Poisson distribution is equal to: -

(a) λ (b) λ2 (c) √λ (d) λ/2
73. The area to the left of the mean in any normal distribution is(a)____________________.

(a) Equal to the mean (b) Equal to 0.5 (c) Equal to 1 (d) Equal to the variance

74. Classifying students in a statistics course by their gender is an example of what scale of
measurement?
a. Ordinal b. Nominal c. Interval d. Ratio

75. A ________________is a tabular summary of data showing the number of items in each
of several non-overlapping classes.
a. Frequency distribution b. Relative frequency c. Probability distribution
d. Cumulative distribution

76. State whether the following question provided is qualitative or quantitative data and
indicates the measurement scale appropriate - What is your age?
a. Qualitative, ratio b. Quantitative, ratio c. Qualitative, nominal

d. Quantitative, ordinal

77. 16. Which of the following Circle Graphs best displays the data that is shown in the
table below?

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a) A b) B c) C d) D

78. If the coefficient of correlation is 0.4, the percentage of variation in the dependent
variable explained by the variation in the independent variable

is 40% b. is 16%. c. is 4% d. can be any positive value

79. If P(A) = 0.50, P(B) = 0.60, and P(A B) = 0.30, then events A and B are
a. mutually exclusive events b. not independent events c. independent events
d. not enough information is given to answer this question

80. The measure of location which is the most likely to be influenced by extreme values in
the data set is the
a. range b. median c. mode d. mean

81. The hourly wages of a sample of 130 system analysts are given below.
mean = 60 range = 20 mode = 73 variance = 324 median = 74

The coefficient of variation equals

a. 0.30% b. 30% c. 5.4% d.54%

Set2 – Descriptive Statistics

True/False Questions
1. A population is a subset of measurements taken from a large group.
Answer: False
2. It is assumed that a sample contains all measurements in which the researcher is
interested.
Answer: True

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3. The first quartile is the 50th percentile.

Answer: False
4. The median is the value that occurs most often in a sample of data.
Answer: False
5. The interquartile range is the difference between the first and the third quartiles.
Answer: True
6. The arithmetic mean assumes an interval level of measurement.
Answer: True
7. The mean, median, and the mode will all be equal when the distribution is symmetric.
Answer: True

8. The Empirical Rule holds for any set of data, regardless of its shape.
Answer: False
9. Chebyshev's Theorem states that at least 8/9 of the observations in a set will lie within 3
standard deviations of the mean.
Answer: True
10. The measure of the degree of asymmetry of a distribution is called kurtosis.
Answer: False
11. Comparing the high temperature in Alaska this month, with the high temperature a year
ago, is an example of using the interval scale of measurement.
Answer: True
12. A record of the numbers of models of each of five models of cars sold by a dealership
during the past 18 months is an example of ordinal data.
Answer: False
13. The mean is more sensitive to skewness than the median.
Answer: False
14. Standard deviation is the square root of variance.
Answer: True

Multiple Choice Questions

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15. Classifying students in a statistics course by their gender is an example of what scale of
measurement?
A) Nominal
B) Ordinal
C) Interval
D) Ratio
Answer: A
16. A distribution that is relatively flat and wide is said to be:
A) skewed to the right
B) symmetric
C) platykurtic
D) kurtosis
E) none of the above
Answer: C
17. The following are the grades a professor gave on the first test in a statistics class: 52, 90,
88, 61, 75, 82, 75, 83, 88, and 86.
What was the median score on this test?
A) 82
B) 82.5
C) 78.5
D) 88
E) 75
Answer: B
18. A clothes store manager has sales data of trouser sizes for the last month's sales. Which
measure of central tendency should the manager use, if the manager is interested in the most
sellable size?
A) mean
B) median
C) mode
D) standard deviation

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E) interquartile range
Answer: C
19. When do the mean, median and the mode have approximately the same value?
A) always
B) never
C) in all symmetric distributions
D) only in symmetric discrete distributions
E) when the standard deviation is very small
Answer: D

20. The average monthly high temperatures for the past seven months are: 68, 72, 44, 50,
45, and 60. What is the mode?
A) 72
B) 50
C) 44
D) 45
E) there is no mode for this data set
Answer: E
21. The mean weight of three gemstones is 20 grams. The weights of two of the stones are
15 grams and 17 grams. What is the weight of the third stone?
A) 16 grams
B) 10 grams
C) 28 grams
D) 14 grams
E) not enough information to determine the weight of the third stone
Answer: C
22. A market research company has collected data on the price of a particular brand of soap
in several different locations. The prices are as follows: $0.89, 0.95, 1.25, 1.36, 1.49, 1.65, 1.79,
1.89, 1.99. What are the upper and lower quartiles of soap prices for this brand?
A) 1.72, 1.17

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B) 1.84, 1.17
C) 1.72, 1.10
D) 2.21, 0.74
E) 1.84, 1.10
Answer: E

23. In a survey conducted among the employees of a local bank, it is found that the
following are the number of children each employee has: 1, 0, 2, 2, 0, 1, 0, 1, 4, 3, 6, 4, 2, 0, 1,
and 3. What is the mean number of children for these employees?
A) 2.5
B) 1.875
C) 1.5
D) 2.0
E) 6.0
Answer: B
Use the following to answer questions 24-25:
The inventory manager at a computer components store randomly selected the records of 200
hard-drive upgrades from the last six months and observed that upgrades fell into the following
capacity categories:

24. In this instance, hard-drive capacity is an example of a(n) ____________ scale of

measurement.
A) Continuous
B) Discrete
C) Nominal
D) Ordinal
E) Probabilistic
Answer: B

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25. Based on the inventory manager's sample, the average hard-drive upgrade is for
approximately ______ gigabytes; the modal hard-drive upgrade is for ______ gigabytes.
A) 60; 40
B) 40; 60
C) 80; 40
D) 80; 60
E) 60; 100
Answer: A
Use the following to answer questions 26-27:
A census is done in a given region. Following are the populations of the towns in that particular
region (in thousands): 35, 46, 52, 63, 64, 71, 77, 82, and 94.
26. What is the median of this data?
A) 64
B) 63.5
C) 67.5
D) 59
E) 35
Answer: A
27. Which of the following is closest to the 30th percentile for these data?
A) 57.5
B) 63
C) 52.7
D) 53
E) 52
Answer: E

28. Several friends go to a casino and do some gambling. The following are the profits each
of these friends make: $120, -$230, $670, -$1020, $250, -$430, and -$60. What is the average
profit of this group?
A) $100

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B) -$100
C) -$1020
D) $397
E) -$397
Answer: B
Use the following to answer questions 29-30:
The number of bottles filled each day in a bottling plant is observed for a week: 674, 589, 613,
689, 554, 586, and 594.
29. Consider the data given above and find the mean.
A) 585
B) 670
C) 586.29
D) 614.14
E) none of the above
Answer: D
30. Consider the sample data given above and find the standard deviation.
A) 24
B) 45.72
C) 49.39
D) 2090.69
E) 2439.14
Answer: C
31. The mean temperature in three rooms is 69.3 degrees Fahrenheit. If a fourth room is
found to have a temperature of 71 degrees, what is the mean of the temperature of the four
rooms?
A) 69.3
B) 70.15
C) 70.325
D) 69.725
E) none of the above

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Answer: D
Use the following to answer questions 32-33:
The numbers that follow are the incomes of professors in a particular college (in thousands of
dollars):
25, 28, 30, 32, 38, 45, 53, 54, 54, 56, 61, 63, 64, 67, 71, 74, 82, 85, 97, and 99.
32. Find both the mean, and the mode for these values.
A) mean = 57, mode = 54
B) mean = 48.11, mode = 57.5
C) mean = 58.9, mode = 54
D) mean = 58.9, mode = 58.5
E) mean = 58.5, mode = 62
Answer: C
33. What is the median income for this group of professors?
A) 56
B) 58.33
C) 58.5
D) 54
E) none of the above
Answer: C
34. The following numbers represent the electricity bill each house in a particular area
received in the past month: $64, 79, 92, 101, 113, 115, 129, 135, 138, 143, 146, 158, 163, 165,
168, 173, 174, 177, 181, 184, 187, 189, 190, 193, 196, 200, 205, 218, 231, 249, and 278. Which
of the following is closest to the 60th percentile for these values?
A) 190.2
B) 179.4
C) 181.8
D) 182.5
E) 177
Answer: B

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35. A class of business students received the following test scores on a standardized test:
320, 410, 440, 470, 480, 480, 490, 500, 500, 510, 510, 530, 530, 530, 540, 570, 600, 650, 720,
and 790. How many students in this group received a score that was greater than the 75th
percentile of this group?
A) 56
B) 5
C) 563
D) 15
E) not enough information to answer
Answer: B
36. When is the median equal to the 50th percentile in a data set?
A) always
B) never
C) only when the mean and the median are equal
D) only in a symmetric distribution
E) only in a skewed distribution
Answer: A
37. Find the variance of the following set of values: 2, 5, 8, 6, and 1.
A) 2.88
B) 4.4
C) 8.3
D) 7
E) 5
Answer: C
38. A salesperson sells the following number of air-conditioners each month, throughout the
year: 3, 5, 5, 6, 12, 17, 14, 9, 4, 2, 1, 1. Find both the mean and the median number of air-
conditioners this salesperson sold.
A) mean = 5.48, median = 7.12
B) mean = 4.5, median = 5
C) mean = 5, median = 5.5

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D) mean = 6.43, median = 15.5

E) mean = 6.583, median = 5
Answer: E
39. Compute the coefficient of variation, if the mean of the set of data is 16 and the
variance is 25.
A) 0.8
B) 0.3125
C) 1.25
D) 1.5625
E) 0.4
Answer: B
40. Compute the geometric mean for: 8, 5 and 3.
A) 4.93
B) 10.95
C) 5.333
D) 5.00
E) 2.5198
Answer: A
41. If a given distribution is known to be symmetric, what percent of the observations are
expected to fall within two standard deviations of the mean?
A) 68%
B) 75%
C) 89%
D) 95%
E) almost all
Answer: D
42. A measure of the degree of asymmetry of a frequency distribution is called?
A) kurtosis
B) skewness

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C) coefficient of variation
D) standard deviation
E) ogive
Answer: B
43. In which type of scale are numbers used as labels for different classes?
A) nominal
B) ordinal
C) interval
D) ratio
E) mean
Answer: A
44. Which of the following scales is the strongest type of scale of measurement?
A) nominal
B) ordinal
C) interval
D) ratio
E) mean
Answer: D
45. A survey in which customers taste five different brands of ice cream, and rank their
favorites from 1 to 5, would be an example of which type of scale of measurement?
A) nominal
B) ordinal
C) interval
D) ratio
E) mean
Answer: B
46. Which of the following is the graph drawn by connecting the midpoints of the classes of
a frequency distribution?
A) ogive

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B) pie chart
C) histogram
D) frequency polygon
E) bar chart
Answer: D
47. The graph of a cumulative frequency distribution is called?
A) ogive
B) pie chart
C) frequency polygon
D) histogram
E) bar chart
Answer: A
48. What is the difference between the variance and standard deviation of a distribution?
A) Variance is used with ordinal data and standard deviation with interval data.
B) Standard deviation is used with ordinal data and variance deviation with interval data.
C) Standard deviation is the positive square of variance.
D) Standard deviation is the square root of variance.
E) They are basically the same thing.
Answer: D
49. What measure of central tendency is most sensitive to skewness?
A) Mode
B) Median
C) Mean
D) They are all about the same
E) Median and Mean
Answer: C

50. What measure of central tendency would be most appropriate for a measurement of salaries if
the salaries are normally distributed?

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A) Mean
B) Median
C) Mode
D) All three; it would depend on your situation
Answer: A
51. What measure of central tendency would be most appropriate for a measurement of
salaries when there are a few people in the sample who make over one million dollars, but most
of the employees sampled made under $50,000?
A) Mean
B) Median
C) Mode
D) All three; it would depend on your situation
Answer: B
Use the following to answer questions 52-55:
A copier services company is considering adding an advanced model to its product line but is
concerned about excessive maintenance calls. During a trial introduction in a test market,
maintenance personnel recorded X, the number of service visits required to get a particular
copier up and running to the customer's satisfaction. These data are summarized in the
following table:

52. Which of the following terms best describes the distribution of required service visits?
A) Right-skewed
B) Left-skewed
C) Symmetrically abnormal
D) Upwardly-kurtotic
E) Downwardly-kurtotic
Answer: A

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53. In total, how many service visits were made by maintenance personnel during the trial
introduction of this copier?
A) 5
B) 11
C) 400
D) 1000
E) None of the above
Answer: D
54. How many copiers were distributed as part of this trial introduction?
A) 5
B) 11
C) 400
D) 1000
E) None of the above
Answer: C
55. What is the average number of service visits required per copier?
A) 1.25
B) 2.50
C) 3.00
D) 5.00
E) None of the above
Answer: B
Use the following to answer questions 56-57:
In a study of its reservation patterns, a national hotel chain randomly sampled the records of 20
of its locations and recorded the number of days last year when the locations had no rooms
available: 165, 126, 59, 47, 146, 64, 39, 75, 86, 114, 51, 68, 58, 38, 66, 72, 42, 85, 40, 59
56. The hotel chain's head of market research has concluded that the sample average would
be a relatively poor indicator of the population's central tendency in this instance. She based
this conclusion on the substantial ______________ exhibited in the sample; in such a case, the
sample mean would tend to ______________ the population's central tendency.
A) Right skew; overstate

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B) Right skew; understate

C) Left skew; overstate
D) Left skew; understate
E) Variance; underestimate
Answer: A
57. Given the data in the above sample, which of the following mean/median pairs is
correct?
A) Sample mean = 65; sample median = 75
B) Sample mean = 65; sample median = 65
C) Sample mean = 75; sample median = 65
D) Sample mean = 75; sample median = 75
E) None of the above
Answer: C
58. The average amount of time required to fill orders at a drive-up window has been
observed to be 120 seconds, with a standard deviation of 10 seconds. Assuming that the
required order-fill time follows a symmetric, bell-shaped distribution, which of the following
statements is correct regarding a random sample of 1,000 observations?
A) We would expect to see approximately 680 of the order fill-times falling in the interval
from 110 seconds to 120 seconds
B) We would expect to see approximately 955 of the order fill-times falling in the interval
from 100 seconds to 140 seconds
C) We would expect to see approximately 27 orders with required fill-times of less than 90
seconds
D) We would expect to see approximately 27 orders with required fill-times in excess of 150
seconds
E) All of the above are correct
Answer: B
59. Suppose men and women are equally in favor of an upcoming property tax initiative. If,
in a random sample of 600 men and 400 women, 240 men were observed to be in favor of the
initiative, which of the following charts is most likely representative of what was observed?

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B)

A)

C) D)

E)
Answer: D

Short Answer Questions

60. The difference between the largest value in a data set and the smallest value is called
the _________________.
Answer: range
61. The standard deviation is always the square root of the __________________.
Answer: variance
62. The number of values in a class divided by the total number of values in the sample is
called the ________________.
Answer: relative frequency

63. The value that occurs most frequently in a data set is called the ________________.

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Answer: mode

Use the following to answer questions 64-65:

A test was conducted to find the number of hours a particular brand of battery lasts. Refer to
the data given below:
200, 204, 197, 191, 203, 198, 216, 210, 202, 204, 198, 203, 181, 205, 194, and 194.
64. Find the mean hours of operation of the battery.
Answer: 200
65. Find the standard deviation of hours of operation of the battery.
Answer: 8.025
66. What is the mean if the highest and the lowest data are both removed from the set, to
remove any extraordinary battery data?
Answer: 200.2
67. In a dormitory, the following is the number of hours the radio plays each day, in each
room: 3.0, 2.4, 3.7, 6.7, 10.6, 1.1, 0.3, 7.4, 8.0, 7.3, 4.5, 3.6, 2.7, 2.4, 3.1, and 1.9. Find both the
median number of hours and the mode for the number of hours the radio is played in these
rooms.
Answer: median = 3.35; mode = 2.4

68. Compute the coefficient of variation for a data set with a mean of 100 and a variance of
25.
Answer: .05
69. The measure of central tendency that is equal to the 50th percentile is called the
______________.
Answer: median
70. What percent of values will be within 2 standard deviations of the mean, in a
distribution which is mound-shaped?
Answer: 95%
71. Classifications based on political preference would be an example of which type of
measurement scale?
Answer: nominal

72. The difference between the third and first quartile is called the _______________.

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Answer: interquartile range

73. The set of all measurements or observations of interest to the statistician is called
______________.
Answer: population
Use the following to answer questions 74-75:
A machine in a ketchup bottling plant is designed to dispense an average of 12 ounces per
bottle, with a variance of 0.5 ounces.
74. If the machine is operating as designed, and if the distribution of amounts dispensed is
relatively symmetric and mound-shaped, what is the proportion of bottles that can be expected
to contain between 11.5 and 12.5 ounces?
Answer: About 68%

75. If the machine is operating as designed, but the distribution of amounts dispensed is not
relatively symmetric or mound-shaped, what is the proportion of bottles that can be expected
to contain between 11 and 12 ounces?
Answer: At least 75%

Use the following to answer questions 76-77:

The following are the valuations (in thousands of dollars) of 16 randomly selected properties
sold during the past year in Acmeville:

130 110 130 130 120 140 120 110

150 150 130 140 130 130 120 140

76. Construct a stem-and-leaf diagram of these data.

Answer:
11 00
12 000
13 000000
14 000
15 00

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77. Briefly describe the shape of the distribution: ___________________.

Answer: Symmetric and mound-shaped

78. A machine in a ketchup bottling plant is designed to dispense an average of 12 ounces

per bottle, with a variance of 0.5 ounces. Find the mean, median, and mode of these data:
Mean: _______
Median: _______
Mode: _______
Answer: Mean: 130; Median: 130, Mode: 130

Use the following to answer questions 79-81:

The following are the valuations (in thousands of dollars) of 16 randomly selected properties
sold during the past year in Acmeville:
130 110 130 130 120 140 120 110
150 150 130 140 130 130 120 140
79. Find the variance and standard deviation of the distribution:
Variance: ______
Standard Deviation: _______
Answer: Variance: 146.67; Standard Deviation: 12.11

80. Based on Chebyshev's theorem, what range would you say should include at least 75%
of property valuations?
Answer: [105.78,154.22]
81. Based on the empirical rule, what range of valuations would you say should include 95%
of property valuations?
Answer: [105.78,154.22]

82. You are interested in forming a company running team, however only 10 of your
colleagues consent to your crazy idea and their 10K times in minutes are as follows: 64, 47, 60,
54, 57, 39, 45, 62, 61, and 55. What is their mean running time and what is their standard
deviation?

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Answer: Mean = 54.4; Standard Deviation = 7.83

83. A quality control consultant randomly sampled 300 bottles from a bottle-filling process
and observed a sample average of 50 ml with a standard deviation of 5 ml. Because the
consultant observed that none of the bottles sampled had less than 35 ml or more than 65 ml,
he concluded that the bottle-filling operation followed a symmetrical, bell-shaped (i.e., normal)
distribution. What else would be required for the consultant to make such a conclusion with
confidence?

Answer: The consultant should also see: 1) approximately 68% (about 204) of the
observations falling within the interval 45 ml to 55 ml; and 2) approximately 95% (about
285) of the observations falling within the interval 40 ml to 60 ml.

84. Alan and Karen are moving to a new area of the country and are searching for a new
home with the help of Cecilia, a local real estate agent. Prior to their first meeting with Cecilia,
Alan and Karen conducted an internet search of homes for sale in their new location and found
that home prices in their random sample averaged $380,000. When they asked Cecilia what
they should expect to pay for a “typical” home in their new location, however, Cecilia told them
that half of all homes sold for less than $300,000. Assuming that both values were correct and
accurately reflected the market, what would be the most likely explanation of such a
discrepancy?

Answer: Alan and Karen calculated a sample average that was pulled upward by the
presence of a few very high-priced homes in the market. Cecilia quoted the median
home to avoid overstating the central tendency given the right skew of home prices in
this market. Type: Concept Difficulty: Easy

Use the following to answer questions 85-86:

Mike and Susan recently won a late-model sports car in a sweepstakes drawing. Not wanting the
car for themselves, they decided to sell it. An internet “car lot” shows 20 recent sales of similar
cars, with the following final selling prices:
4050, 3750, 3100, 4540, 1800, 4400, 3995, 3670, 3900, 5000
3730, 4130, 4005, 2100, 4120, 4200, 4540, 3775, 3700, 4180

85. Suppose Mike and Susan want a quick sale. What should their approximate price be if
they are willing to let their car go at approximately the 10th percentile?
Answer: They should price their car at approximately $2,100 Type: Computation
Difficulty: Medium

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86. Now suppose Mike and Susan would like their car's sale price to reflect the central
tendency of the population of similar cars that are sold. Is there anything exhibited by these
data that might make the median preferable to the mean with respect to setting a final sale
price?
Answer: These data exhibit a strong left skew due to the prices of the three cheapest
cars. Thus, the mean of $3,834 is downwardly biased and the median price of $4,000
might be a better estimate. Type: Computation Difficulty: Medium

Probability

True / False Questions

1. Objective probability involves personal judgment or intuition in a given context.

FALSE

2. Those elements that are not in Set A are called the complement of A.
TRUE

3. The set of all basic outcomes of an experiment is called the union of the set.
FALSE

4. In the experiment of tossing a fair die once, the sample space includes six events.
TRUE

5. The probability of event A is defined as the number of ways event A can occur, divided by the number
of outcomes possible in the experiment.
TRUE

6. In the experiment consisting of drawing one card at random from a standard deck of 52 cards, the
sample space for the event of drawing a seven consists of 2 outcomes.
FALSE

7. The probability of drawing a seven, from a standard deck of 52 cards is 1/4.

FALSE

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8. If event A consists of the event of drawing a red card from a standard deck of 52 cards, then the
complement of event A is the event of drawing a black card from this deck.
TRUE

9. The intersection of two sets includes all elements that are part of either set or both sets.
FALSE

10. The probability of event A, an event that is certain to occur is one.

TRUE

11. The probability of drawing a card, chosen at random from a standard deck of 52 cards, which is
either a diamond or a club is 0.5.
TRUE

12. Two events which are mutually exclusive events, are also complements of each other.
FALSE

13. When two events, A and B, are independent, then the product of their individual probabilities is
equal to the probability that both events occur or P(A) x P(B) = P(A ∩ B).
TRUE

14. In order to count the number of ways that a committee of three, including a chair, a secretary and a
treasurer, could be chosen from a group of ten people, a combination would be used.
FALSE

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15. The probability of any particular event or combination of events, can be larger than one in certain
specific cases.
FALSE

16. The probability of rolling a 7 on a pair of dice is higher than rolling any other number.
TRUE

17. If the probability of rolling a 2 on a pair of dice is 1/36, the probability of not rolling a 2 is 35/36.
TRUE

Multiple Choice Questions

18. One out of three mini-vans sold by a nationwide auto dealer has a hidden defect in its transmission.
What is the probability that a randomly selected purchaser of two mini-vans will wind up with at least
one mini-van with a defective transmission?
A. 0.333
B. 0.500
C. 0.667
D. 0.250
E. 0.556

19. One out of three mini-vans sold by a nationwide auto dealer has a hidden defect in its transmission.
If a small business purchases four mini-vans from this dealer, what is the probability that this purchaser

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will wind up with exactly two mini-vans with defective transmissions?

A. 0.2963
B. 0.1111
C. 0.2222
D. 0.7037
E. 0.7778

20. An experienced business-school graduate has an 80% probability of getting a particular job. An
inexperienced business-school graduate has a 50% chance of getting the same job. 60% of business-
school graduates are inexperienced. If the job is offered to a business-school graduate, what is the
probability that the person was inexperienced?
A. 0.4
B. 0.6
C. 0.3
D. 0.4839
E. 0.6667

21. A manager assigns three different jobs to five different operators at random. Each operator is best-
suited for a distinct job. What is the probability that each job will be assigned to that operator who is
best for that job?
A. 3/5
B. 1/60
C. 3/50
D. 5/60
E. 1/15

Use the following to answer questions 22-23:

The probability that a customer will buy a product given that he or she has seen an advertisement for
the product is 0.15. The probability that a consumer will see an ad for this particular product is 0.20.

22. What is the probability that a consumer will both see the ad and buy the product?
A. 0.75
B. 0.075
C. 0.35

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D. 0.03
E. 0.035

23. The probability that a consumer who did not see this ad will buy the product is 0.05.
Find the probability that a given consumer will buy the product.
A. 0.04
B. 0.07
C. 0.03
D. 0.012
E. None of the above

24. The probability that account A will have an error in it is 0.75. The probability that account B will have
an error in it is 0.40. The probability that both accounts will be in error is 0.20. Are these two accounts
independent of each other?
A. Yes
B. No
C. Insufficient information to determine

25. The probability that a shot will hit the target is 0.02. Successive shots are independent of each other.
What is the probability that at least one out of four shots will hit the target?
A. 0.25
B. 0.005
C. 0.99999984
D. 0.00000016
E. 0.0776

26. A car gets involved in an accident 80% of the time if it is defective. If it is not defective, the
probability reduces to 40%. 30% of all cars are defective. If a car is involved in an accident, what is the
probability that it was defective?
A. 0.32
B. 0.24

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C. 0.4615
D. 0.12
E. 0.0343

27. Thirty percent of the managers in a certain company have MBA degrees as well as professional
training. Eighty percent of all managers in the firm have professional training. If a manager is randomly
chosen and found to have professional training, what is the probability that he or she also has an MBA?
A. 0.24
B. 0.5
C. 0.375
D. 0.26
E. 0.625

28. A box has 20 screws, three of which are known to be defective. What is the probability that the first
two screws taken out of the box are both defective?
A. 0.0158
B. 0.15
C. 0.0237
D. 0.0225
E. None of the above

29. A box has 20 screws, three of which are known to be defective. What is the probability that exactly
one of the first two screws taken out of the box are defective?
A. 0.1342
B. 0.2684
C. 0.05
D. 0.0158
E. None of the above

Use the following to answer questions 30-31:

Two players are competing in a shooting gallery, each getting one shot at the target. The probability of

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the first shooter hitting the target is 0.57 and the probability of the second shooter hitting the target is
0.65.

30. What is the probability that both shooters hit their targets?
A. 0.08
B. 0.8769
C. 0.3705
D. 0.614
E. 0.6615

31. What is the probability that at least one of the two players hits the target?
A. 0.3705
B. 0.8769
C. 0.2795
D. 0.8495
E. 1.22

32. A company has two production lines for plastic bottles, A and B. Two percent of the bottles coming
off of line A are defective and 8% of those off of line B are defective. Line A produces three times as
many bottles as Line B. If a bottle is selected at random and found to be defective, what is the probability
that it came from line A?
A. 0.04
B. 0.4
C. 0.1111
D. 0.4286
E. 0.625

33. A particular company has twenty salespeople. How many ways can a group of three salespeople be
chosen from this company?
A. 1140
B. Permutation of 20 chose 3
C. Combination of 20 chose 20
D. 5700
E. None of the above

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Use the following to answer questions 34-35:

An urn contains two red balls and three white balls.

34. If a ball is chosen at random, what is the probability that it is white?

A. 0
B. 1
C. 2/5
D. 1/5
E. 3/5

35. Suppose two balls are drawn randomly. What is the probability that both will be white?
A. 1/10
B. 3/20
C. 6/20
D. 9/20
E. 9/25

36. The probability that a contractor will win a bid for contract A is 0.45; the probability that the
contractor will win a bid for contract B is 0.25. The two bids are believed to be independent of each
other. What is the probability that the contractor will win at least one of the two bids?
A. 0.70
B. 0.20
C. 0.1125
D. 0.5875
E. 0.5556

37. The probability of stock A rising is 0.3 and of stock B rising is 0.4. What is the probability that neither
of the stocks rise, assuming that these two stocks are independent?
A. 0.42

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B. 0.12
C. 0.88
D. 0.44
E. 0.70

38. The probability of stock A rising is 0.3 and of stock B is 0.4. If stocks A and B are not independent and
the probability of both stocks rising is 0.09, what is the probability that neither stock rises?
A. 0.61
B. 0.39
C. 0.12
D. 0.91
E. 0.03

39. A bag has five pearls in it, out of which one is artificial. If three pearls are taken out at random, what
is the probability that the artificial pearl is one of them?
A. 1/5
B. 2/5
C. 3/5
D. 4/5
E. None of the above

40. What is the probability of getting at least one six in five rolls of a single fair die?
A. 1/5
B. 1/30
C. 1/6
D. 5/6
E. 0.5981

41. If the probability of event A is 0.5 and the probability of event B is 0.25 and nothing else is known
about A and B, then the probability that either A or B or both will occur, is?
A. 0.75

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B. 0.125
C. 0
D. 0.25
E. Insufficient information to determine

42. The probability that a missile will hit the target in a given launching is 0.2. Launches are known to be
independent of each other. The probability that at least one missile will hit the target in 3 independent
launches is:
A. 0.488
B. 0.505
C. 0.6
D. 0.8
E. 0

43. The probability that both events A and B will occur is 0. 15. The probability that event A will occur is
0.3. Then the probability that A will occur, given that B has occurred is:
A. 0
B. 0.5
C. Insufficient information to determine
D. 0.05
E. 0.15

44. Suppose that two events A and B are mutually exclusive. We know that the probability of A is 0.4 and
the probability of B is 0.2. The probability that either A or B (or both) will occur is:
A. 0.08
B. 0.52
C. 0.60
D. 0
E. None of the above

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45. Suppose that the probability of A is 0.7 and the probability of B is 0.4 and we know that the
probability that both A and B will occur is 0.28. Then the two events are
A. Unrelated to each other
B. Mutually exclusive
C. Independent
D. Dependent
E. Unable to occur at the same time

46. If the probability of A is 0.45 and the probability of the intersection of A and B is 0.15, then the
probability that B will occur given that A has occurred is:
A. 3.00
B. 1.00
C. 1/3
D. 1/9
E. 0.675

47. The probability that event A will occur is 0.6. Given that event A occurs, the probability that event B
will occur is 0. The probability that both events A and B will occur is:
A. 1
B. 0
C. Insufficient information to determine
D. 0.6
E. 0.4

48. The probability of event A is 0.7 and the probability of event B is 0.7. Then the probability of the
intersection of A and B is?
A. 0.49
B. 0
C. 1
D. 1.4
E. Insufficient information to determine

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49. The probability of event A is 0.99, the probability of event B is 0.01 and the probability of event C is
0.01. The three events are independent of each other. The probability that at least one of the three
events will occur is:
A. 1.01
B. 1
C. 0.99
D. 0.099
E. 0.01

50. The probability that a rocket will hit a target is 0.8. Five different rockets of this type are fired.
Assuming that the rockets are fired independently, the probability that all rockets will hit their target is:
A. 0.3277
B. 0.9996
C. 0.0004
D. 0.6723
E. None of the above

51. If the P(A) = 0.3; P(B) = 0.5 and A and B are mutually exclusive, then the probability of A or B or both
occurring is:
A. P(A) + P(B)
B. P(A) x P(B)
C. P(A) + P(B) - P(A) x P(B)
D. Zero
E. Cannot be determined

52. If P(A) = 0.2; P(B) = 0.6 and A and B are independent events, then the P(A U B) is:
A. P(A) + P(B)
B. P(A) x P(B)
C. P(A) + P(B) - P(A) x P(B)
D. Zero
E. Cannot be determined

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53. If the probability of A is 0.5 and the probability of B is 0.2 and the probability of the union of A and B
is 0.7, then:
A. A and B are independent
B. A and B are mutually exclusive
C. A and B are dependent
D. A and B do have an intersection
E. Impossible to determine

54. If the probability of A is 0.33 and the probability of B is 0.33 and the probability of either A and B
both occurring is 0.66, then:
A. A and B are dependent
B. A and B are independent
C. A and B are mutually exclusive
D. If A occurs, B is certain to occur
E. There is not enough information to make a conclusion

55. If the probability of A is 0.6 and the probability of A given B is 0.2, then the probability of the
intersection of A and B is:
A. 0.12
B. 0.3333
C. 0.80
D. 0.68
E. Insufficient information to determine

56. I shoot at a target five times and each time my probability of hitting is 0.40. Assuming that each shot
is independent, my probability of hitting the target at least once is:
A. 0.01024
B. 0.07776
C. 0.92224

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D. A number very close to zero

E. None of the above

57. The probability that I get job A is 0.45; the probability that I get job B is 0.60 and the probability that I
get both the jobs is 0.30. The probability that I get at least one job offer is:
A. 0.30
B. 0
C. 1
D. 0.55
E. 0.75

58. The probability that event A will occur is 0.90 and the probability that event B will occur is 0.10. The
two events are known to be mutually exclusive. The probability that both A and B will occur is:
A. 0
B. 1
C. 0.5
D. 0.33
E. Insufficient information to determine

59. The probability that account A is in error is 0.05 and the probability that account B is in error is 0.05.
Nothing else is known about the nature of the accounts or any relationship between them. The
probability that at least one of the two accounts is in error is:
A. 0.05
B. 0.10
C. 0.0975
D. 0
E. Insufficient information to determine

60. The probability that event A will occur is 0.7 and the probability that event B will occur is 0.7 and the
probability that both events will occur is 0.49. The two events are:
A. Independent

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B. Mutually exclusive
C. Dependent
D. Disjoint
E. Insufficient information to determine

61. The probability of a successful merger with a larger firm is 0.40. Given that a merger is successful,
there is a 0.25 probability that profits next year will be high. What is the probability that both the merger
will succeed and that profits next year will be high?
A. 0.10
B. 1
C. 0.15
D. 0.625
E. 1.6

Use the following to answer questions 62-66:

The following table shows the outcome of 500 interviews attempted during an opinion survey of
randomly selected individuals in four counties:

62. What is the probability that a randomly selected interview report was actually completed?
A. 0.20
B. 0.25
C. 0.60
D. 0.75
E. 0.80

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63. What is the probability that a randomly selected interview report came from Applewood County?
A. 0.20
B. 0.25
C. 0.60
D. 0.75
E. 0.80

64. What is the probability that a randomly selected interview report involved a Doughton County
respondent a refusal to be interviewed?
A. 0.38
B. 0.30
C. 0.25
D. 0.08
E. 0.02

65. What is the probability that a randomly selected interview report involved a Bakingwell County
respondent a completed interview?
A. 0.62
B. 0.65
C. 0.68
D. 0.83
E. 0.85

66. Suppose a randomly selected interview report is from Crustboro County. What is the probability the
person targeted wasn't at home?
A. 0.27
B. 0.48
C. 0.65
D. 0.72
E. 0.84

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Use the following to answer questions 67-68:

A construction company employs three engineers—Alfred, Becky and Chris—whose responsibility it is to
estimate costs for input into bids for prospective jobs. While each engineer is very good at his or her
work, each also occasionally makes a serious error in cost estimation. Their past performance with
respect to productivity and accuracy has been summarized in the following table:

67. Suppose a recently developed cost estimate has been shown to be seriously inaccurate. What is the
probability that this estimate was prepared by Chris?
A. 0.250
B. 0.482
C. 0.518
D. 0.815
E. 0.842

68. Suppose a recently developed cost estimate has been shown to be seriously inaccurate. What is the
probability that this estimate was prepared by either Alfred or Becky?
A. 0.022
B. 0.090
C. 0.518
D. 0.750
E. 0.815

69. Five of the 12 members of the board of directors of Giganticus, Inc., will be placed on a
subcommittee that will decide if John Goodhair, Chairman and CEO, will remain in his position. How
many subcommittees are possible if members are randomly chosen?
A. 792
B. 879
C. 972
D. 95040
E. None of the above

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70. Members of a special marketing project team have decided to break the work up into smaller
portions and divide it among sub-groups. There are 9 team members. How many different sub-groups
are possible if each sub-group consists of 4 members and order doesn't matter?
A. 362880
B. 3024
C. 126
D. 42
E. 24

71. Members of a special marketing project team have decided to break the work up into smaller
portions and divide it among sub-groups. There are 7 team members. How many different sub-groups
are possible if each sub-group: a) consists of 3 members and b) has a sub-group chairperson and vice-
chairperson?
A. 5040
B. 210
C. 187
D. 35
E. 6

72. MBA students at a private business school can, if they wish to do so, choose a concentration in one
of three areas: real estate development, financial planning or marketing/promotions. For those students
who don't wish to concentrate in a particular area, the school offers a generalist track. If an experiment
consisted of randomly sampling a student in the MBA program, the sample space for the experiment
would be described as _______________.
A. Pursuing a concentration and Ā: not pursuing a concentration
B. Pursuing one concentration and Ā: pursuing more than one concentration
C. Concentrating in real estate development and Ā: concentrating in either financial planning or
marketing/promotions
D. Concentration in real estate development and Ā: concentration in another area
E. Pursuing an MBA and Ā: not pursuing an MBA

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73. A mortgage lender that buys mortgages from both prime and sub-prime originators is studying the
payment histories of the mortgages it has held recently. A random sample of 1,000 mortgage histories is
summarized as follows:

A mortgage is to be randomly selected from this sample. What is the probability that it has shown no
late payments over its five-year history?
A. 0.526
B. 0.208
C. 0.266
D. 0.734
E. 0.812

74. A mortgage lender that buys mortgages from both prime and sub-prime originators is studying the
payment histories of the mortgages it has held recently. A random sample of 1,000 mortgage histories is
summarized as follows:

A mortgage is to be randomly selected from this sample. What is the probability that it will be either: a)
originated by a sub-prime originator or b) has been in default over its five-year history?
A. 0.055
B. 0.034
C. 0.342
D. 0.376
E. 0.381

75. A mortgage lender that buys mortgages from both prime and sub-prime originators is studying the
payment histories of the mortgages it has held recently. A random sample of 1,000 mortgage histories is
summarized as follows:

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A mortgage is to be randomly selected from this sample. If the mortgage was originated by a prime
originator, what is the probability that it has had no late payments over its five-year history?
A. Not more than 0.45
B. More than 0.45 but not more than 0.55
C. More than 0.55 but not more than 0.65
D. More than 0.65 but not more than 0.75
E. More than 0.75

76. Researchers have found that, for professional basketball players, the probability of making any given
free throw is virtually constant over time. This means that when a basketball player is awarded two free
throws, his/her likelihood of making the second free throw remains the same regardless of what
happened on his/her first try. That is, P(make second| made first) = P(make second| missed first). This is
an example of events being:
A. Statistically independent
B. Sequentially intercorrelated
C. Serially interconnected
D. Temporally isolated
E. Trivially heteroscedastic

77. Craps is a popular casino game in which players bet on rolls of two fair, six-sided dice. A popular bet is
the so-called "Field Bet", a single-roll bet in which the player wins if a 2, 3, 4, 9, 10, 11 or 12 is thrown.
There are 36 possible combinations of two fair, six-sided dice and there are 16 possible dice
combinations that result in a win on the "Field Bet". What is the probability of winning on any single
"Field Bet"?
A. Not more than 0.3
B. More than 0.3 but not more than 0.4
C. More than 0.4 but not more than 0.5
D. More than 0.5 but not more than 0.6
E. More than 0.6

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78. Craps is a popular casino game in which players bet on rolls of two fair, six-sided dice. A popular bet is
the so-called "Field Bet", a single-roll bet in which the player wins if a 2, 3, 4, 9, 10, 11 or 12 is thrown.
There are 36 possible combinations of two fair, six-sided dice and there are 16 possible dice
combinations that result in a win on the "Field Bet". Assuming that the outcome of any roll of the dice is
independent of previous rolls, what is the probability of winning three times consecutively on the "Field
Bet"?
A. Not more than 0.1
B. More than 0.1 but not more than 0.2
C. More than 0.2 but not more than 0.3
D. More than 0.3 but not more than 0.4
E. More than 0.4

79. Ree-Lax Inns, a national hotel chain, buys mattresses from only two firms. Because Supplier A's
defect rate (3%) is twice that of Supplier B, Ree-Lax buys three-fourths of its mattresses from Supplier B.
Suppose a mattress has been found to be defective. What is the probability it was produced by Supplier
B?
A. 0.01125
B. 0.3
C. 0.6
D. 0.75
E. 0.81

Short Answer Questions

80. The probability that traffic will be banned around the town square if a certain legislation is passed is
0.85. The probability that traffic will be banned if the legislation in question does not pass is 0.20. If the
probability that the legislation will pass is 0.40, what is the probability that traffic will be banned?
(.85) x (.40) + (.20) x (.60) = 0.34 + 0.12 = 0.46

81. My probability of getting job A is 0.20; my probability of getting job B is 0.10; my probability of
getting job C is 0.35 and my probability of getting job D is 0.05. All jobs are independent of each other.
What is my probability of getting at least one of these jobs?

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1 - P(not getting any of the 4 jobs) = 1 - [(.8) x (.9) x (.65) x (.95)] = 1 - 0.446 = 0.5554

82. Two or more events which cannot occur at the same time are called ________________.
mutually exclusive

83. When two events are disjointed, the probability that they both occur is _____________.
zero

84. If the P(A) = 0.20 and P(B) = 0.30 and the two events are mutually exclusive, what is the P(A ∩B)?
zero

85. If the P(A) = 0.20 and P(B) = 0.30 and A and B are known to be independent, what is the probability
of the intersection of A and B?
0.20 x 0.30 = 0.06, if A and B are independent

86. Ten people try out for a local basketball team. If only five people can be chosen for the team and all
players can play all positions, how many ways can this team be chosen?
combination of 10 choose 5 = 252

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87. Suppose 100 people enter a drawing for three grand prizes of $10,000, $5,000 and $1,000. How
many ways can the winners for these three prizes be selected?
permutation of 100 choose 3 = 100 x 99 x 98 = 970,200

88. If the probability of event A is 0.82, what is the probability of the complement of event A?
1 - 0.82 = 0.18

Use the following to answer questions 89-92:

On the assembly line, a bin of nuts has three times as many nuts as bolts. (Assume an unlimited supply.)

89. What is the probability that, without looking, a worker will pull out a nut on the first grab?
1/4

90. What is the probability that the second grab will produce a nut?
1/4

91. What is the probability that the second grab will produce a nut if the first grab produced a bolt?
1/4

92. What is the probability that two grabs will produce one nut and one bolt?
3/8

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Use the following to answer questions 93-94:

On the assembly line, a bin of nuts has three times as many nuts as bolts. (Assume an unlimited supply.)

93. Suppose that later in the day, on the same assembly line, the bin has been emptied down to eight
nuts and two bolts. What is the probability that, without looking, a worker will pull out a nut on the first
grab?
8/10

94. Suppose that later in the day, on the same assembly line, the bin has been emptied down to eight
nuts and two bolts. What is the probability that two grabs will produce a nut and a bolt?
16/45

95. A shipment of 144 widgets is to be rejected if one or more out of five selected at random are found
to be defective. If a particular shipment has three defective items, what is the probability that the
shipment will be rejected?
0.1013

Use the following to answer questions 96-97:

A certain weather forecaster is correct 80% of the time when he forecasts rain and 90% of the time when
he forecasts sun. Given the climate in his area, 30% of his forecasts are for rain and 70% are for sun.

96. Suppose it rained yesterday. What is the probability that yesterday's forecast actually called for rain?
0.7742

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97. What is the overall probability of a correct forecast?

0.87

Use the following to answer questions 98-99:

A large urn contains n red balls, 2n green balls and 3n blue balls. Three balls are drawn at random, one
after another.

98. What is the probability of the sequence: RGB?

1/36

99. What is the probability that all three balls will be the same color?
1/6

Use the following to answer questions 100-101:

A small urn contains 4 red balls, 8 green balls and 12 blue balls. Three balls are drawn at random, one
after another, without replacement.

100. What is the probability of the sequence: RGB?

8/253 = 0.03162

101. What is the probability that all three balls will be the same color?
35/253 = 0.1383

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102. You are playing dice and have a sudden urge to bet on a hard six, a role of three on each die. What
is the probability that you will roll a hard six on the next roll of the pair of dice?
1/36 = .0278

103. You are playing dice and have an urge to bet on either six or an eight being rolled. What is the
probability that you will win your bet on the next roll of the pair of dice?
5/36 + 5/36 = .2778

Use the following to answer questions 104-105:

WAN Services has a 1,000 customer service representatives, 30% of whom have undergone extensive
training in the S.M.I.L.E. Method. Since the training began, WAN management has kept track of those
representatives who have had at least one customer complaint and has observed that the complaint
total attributed to non-trained representatives is more than twice that (455 vs. 195) of trained
representatives.

104. If a randomly selected customer-service representative has undergone S.M.I.L.E. Training, what is
the probability that he or she will have generated at least one customer complaint?
195/300 = 0.65

105. Management has come to the conclusion that the S.M.I.L.E. Method is a valuable tool for improving
customer service. Do you agree and why or why not?

Answer. No, since those who have undergone the S.M.I.L.E. Training have the same probability of
generating a complaint (195/300 = 0.65) as those who have not undergone the training (455/700 = 0.65).

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106. Auditors have observed that a particular accounting error tends to be associated with attempts to
misstate financial positions. Approximately 85% of firms attempting to misstate their earnings will
commit this accounting error; for a firm trying to misstate its earnings, the likelihood of making this
error is approximately 5%. It has been estimated that the percentage of firms attempting to misstate
earnings at any given time is only 5%. Suppose that in an audit of QRS Airlines, an auditor discovers this
particular accounting error. What is the probability that this is an honest mistake (i.e., QRS has actually
been attempting to misstate its earnings)?

Answer. (.85 * .05)/[ (.85 * .05) + (.05 * .95) ] = 0.4722

107. An airline is considering making changes to its frequent flier program. As a start, it randomly
samples 2,000 passengers from the past six months. The data indicate that there are three broad classes
of passengers: A) those who accumulate frequent flier miles by flying; B) those who accumulate
frequent flier miles by both flying and participating in partner (e.g., credit card) programs and C), those
who do not participate in the airline's frequent flier program. The data are summarized in the following
table:

A random passenger is to be selected from this sample. What is the probability that this passenger:
a) is a man?
b) doesn't participate in the frequent flier program?
c) is either a woman or a passenger who accumulates miles both through flying and through a partner's
program?
d) is both a man and a non-participant in the frequent flier program?

Answer:
a) 0.6
b) 0.02
c) 0.706
d) 0.012

108. In a market test of a restaurant chain's new "Smart-Size" portions, 800 of 1,200 younger (≤ 30 years
old) customers rated the new products favorably. Of the 450 older (> 30 years old) customers, only 300

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rated the new products favorably. What is:

a) the probability a customer will rate the products favorably given she/he is over 30 years old?
b) the probability a customer who rates the products unfavorably will be a younger (≤ 30 years old)
customer?
c) To market the new "Smart-Size" portions, management is considering developing separate marketing
strategies for older and younger customers. Do these results indicate that separate marketing strategies
are necessary?

Answer:
a) 0.667
b) 0.727
c) These data indicate that age (younger vs. older) and satisfaction with the "Smart-Size" portions are
statistically independent – P(favorable | older) = 0.667 and P(favorable | younger) = 0.667. Perhaps
separate campaigns are not necessary.

109. Suppose research has indicated that only 1% of credit card transactions are fraudulent. Further
suppose that 0.03% of fraudulent credit card transactions are associated with internet casinos, but that
only 0.0007% of non-fraudulent credit card transactions are associated with internet casinos. If a given
credit card transaction involves an internet casino, what is the probability it is fraudulent?

Answer. 0.302115 = (0.0003*.01)/[(0.0003*0.01) + (0.000007*0.99)]

----------------------------------------------- X - QMM-Model-Question-Paper – X
----------------------------------------------------------------------------------------- X – Quizlet starts – X
--------------------------------------

An uncertain future event affecting the consequence, or payoff, associated with a

decision is known as
a. unconditional probability
b. unknown probability
c. chance event
d. uncertain probability
chance event

The result obtained when a decision alternative is chosen and a chance event occurs is
known as
a. happenstance
b. consequence
c. alternative probability
d. conditional probability
Consequence

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Nodes indicating points where a decision is made are known as

a. decision nodes
b. chance nodes
c. marginal nodes
d. conditional nodes
decision nodes

Nodes indicating points where an uncertain event will occur are known as
a. decision nodes
b. chance nodes
c. marginal nodes
d. conditional nodes
chance nodes

New information obtained through research or experimentation that enables an updating

or revision of
the state-of-nature probabilities is
a. population information
b. sampling without replacement
c. sample information
d. conditional information
sample information

The probability of one event given the known outcome of a (possibly) related event is
known as
a. unconditional probability
b. joint probability
c. marginal probability
d. conditional probability
conditional probability
The probability of both sample information and a particular state of nature occurring
simultaneously is
a. unconditional probability
b. joint probability
c. marginal probability
d. conditional probability
Joint probability

A tabular representation of the payoffs for a decision problem is a

a. decision tree
b. payoff table
c. matrix
d. sequential matrix
payoff table

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The uncontrollable future events that can affect the outcome of a decision are known as
a. alternatives
b. decision outcome
c. payoff
d. states of nature
states of nature

An intersection or junction point of a decision tree is called a (n)

a. junction
b. intersection
c. intersection point
d. node
Node

A line or arc connecting the nodes of a decision tree is called a(n)

a. junction
b. intersection
c. branch
d. node
Branch

A decision criterion which weights the payoff for each decision by its probability of
occurrence is
known as the
a. Payoff criterion
b. expected value criterion
c. probability
d. expected value of perfect information
expected value criterion

For a decision alternative, the weighted average of the payoffs is known as

a. the expected value of perfect information
b. the expected value
c. the expected probability
d. perfect information
the expected value

The expected opportunity loss of the best decision alternative is the

a. expected monetary value
b. payoff
c. expected value of perfect information
d. None of these alternatives is correct.
expected value of perfect information

In computing an expected value (EV), the weights are

a. decision alternative probabilities

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b. in pounds or some unit of weight

c. in dollars or some units of currency
d. the state-of-nature probabilities
the state-of-nature probabilities

The probability of the states of nature, after use of Bayes' theorem to adjust the prior
probabilities
based upon given indicator information, is called
a. marginal probability
b. conditional probability
c. posterior probability
d. None of these alternatives is correct.
conditional probability

The efficiency of information is the ratio of

a. EOL to EVSI
b. EOL to EVPI
c. EVPI to EVSI
d. EVSI to EVPI
EVSI to EVPI

Future events that cannot be controlled by the decision maker are called
a. indicators
b. states of nature
c. prior probabilities
d. posterior probabilities
states of nature

A tabular presentation of the expected gain from the various options open to a decision
maker is called
a. a payoff table
b. a decision tree
c. the expected opportunity loss
d. the expected value of perfect information
a payoff table
A graphic presentation of the expected gain from the various options open to the
decision maker is
called
a. a payoff table
b. a decision tree
c. the expected opportunity loss
d. the expected value of perfect information
a decision tree

The expected value of information that would tell the decision maker exactly which state
of nature is

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going to occur is
a. the expected value of sample information
b. the expected value of perfect information
c. the maximum information
d. the expected value
the expected value of perfect information

Prior probabilities are the probabilities of the states of nature

a. after obtaining sample information
b. prior to obtaining of perfect information
c. prior to obtaining sample information
d. after obtaining perfect information
prior to obtaining sample information

The probabilities of states of nature after revising the prior probabilities based on given
indicator
information are
a. the expected probabilities
b. the posterior probabilities
c. the prior probabilities
the posterior probabilities

Information about a state of nature is known as

a. natural information
b. states information
c. a sampling method
d. an indicator
an indicator
The process of revising prior probabilities to create posterior probabilities based on
sample
information is a
a. revision process
b. sampling revision
c. Bayesian revision
d. posterior revision
Bayesian revision

The difference between the expected value of an optimal strategy based on sample
information and the
"best" expected value without any sample information is called the
a. optimal information
b. expected value of sample information
c. expected value of perfect information
d. efficiency of information
expected value of sample information

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Below you are given a payoff table involving two states of nature and three decision
alternatives.
Refer to Exhibit 21-1. The expected monetary value of the best alternative is
a. 8.8
b. 7.4
c. 9.6
d. 11.6
11.6

Refer to Exhibit 21-1. The recommended decision alternative based on the expected
monetary value is
a. A
b. B
c. C
d. All alternatives are the same.
B (10-12)

Refer to Exhibit 21-1. The expected monetary value of alternative A is

a. 7.4
b. 11.6
c. 8.8
d. 13
7.4

Refer to Exhibit 21-1. The expected value of perfect information is

a. 6.2
b. 2.0
c. 13.6
d. 4.8
2.0

Below you are given a payoff table involving three states of nature and two decision
alternatives.
The probability that S1 will occur is 0.1; the probability that S2 will occur is 0.6.
Refer to Exhibit 21-2. The recommended decision based on the expected value criterion
is
a. A
b. B
c. Both alternatives are the same.
d. None of these alternatives is correct
B (40-50-15)

Refer to Exhibit 21-2. The expected value of the best alternative equals
a. 29
b. 105

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c. 12
d. 38.5
38.5

Refer to Exhibit 21-2. The expected value of perfect information equals

a. 12
b. 4
c. 37
d. 29
4

Below you are given a payoff table involving two states of nature and three decision
alternatives.
The probability of the occurrence of state of nature S1 is 0.4.
Refer to Exhibit 21-3. The recommended decision based on the expected monetary
value criterion is
a. A
b. B
c. C
d. All alternatives are the same.
C (25,000 - 10,000)

Refer to Exhibit 21-3. The expected monetary value of the best alternative equals
a. 13,000
b. 14,000
c. 15,000
d. 16,000
16,000
Refer to Exhibit 21-3. The expected value of perfect information equals
a. 13,000
b. 14,000
c. 15,000
d. 16,000
13,000

Below you are given a payoff table involving two states of nature and three decision
alternatives.
The probability of the occurrence of S1 = 0.3.
Refer to Exhibit 21-4. The expected value of the best alternative is
a. 12.9
b. 13.2
c. 10.2
d. 28.0
13.2

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Refer to Exhibit 21-4. The recommended decision alternative based on the expected
monetary value is
a. A
b. B
c. C
d. None of these alternatives is correct.
B (16-12)

Refer to Exhibit 21-4. The expected monetary value of alternative C is

a. 10.2
b. 13.2
c. 12.9
d. 26
10.2

Refer to Exhibit 21-4. The expected value of perfect information is

a. 1.5
b. 1.2
c. 1.0
d. 4.8
1.2

Below you are given a payoff table involving three states of nature and three decision
alternatives.
The probability of occurrence of S1 is 0.2 and the probability of occurrence of S2 is 0.3.
Refer to Exhibit 21-5. The expected monetary value of the best alternative is
a. 5.0
b. 6.5
c. 7.5
d. 9.0
6.5

Refer to Exhibit 21-5. The recommended decision alternative based on the expected
monetary value is
a. A
b. B
c. C
d. All alternatives are the same.
A

Refer to Exhibit 21-5. The expected monetary value of alternative C is

a. 30
b. 6.5
c. 5.7
d. 5.5
5.5

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Refer to Exhibit 21-5. The expected value of perfect information is

a. 18.2
b. 11.7
c. 51
d. 37
11.7
---------------------------------------------------- X – Quizlet Ends – X --------------------------------------
---------------------------------------------------- X – Ch03 Starts – X --------------------------------------

CHAPTERTHREE
De
scr
ipt
iveSt
ati
st
ics

C 1. Statistical measures used to yield information about the middle of a group of

numbers are called _______.

E A. averages
Term B. measures of variability
C. measures of central tendency
D. Z scores

C 2. Which of the following is NOT a measure of central tendency?

E A. mean
Term B. median
C. variance
D. mode

A 3. The most frequently occurring value in a set of data is called the _______.

E A. mode
Term B. mean
C. median
D. coefficient of variation

A 4. Which of the following is an appropriate measure of central tendency for nominal

data?

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E A. mode
Term B. mean
C. median
D. coefficient of variation

C 5. Which of the following is an appropriate measure of central tendency for ordinal

data?

E A. standard deviation
Term B. mean
C. median
D. coefficient of variation

C 6. The lowest appropriate level of measurement for the mean is _________.

E A. nominal
Term B. ordinal
C. interval
D. ratio

B 7. The lowest appropriate level of measurement for the median is _________.

E A. nominal
Term B. ordinal
C. interval
D. ratio

A 8. The lowest appropriate level of measurement for the mode is _________.

E A. nominal
Term B. ordinal
C. interval
D. ratio
C 9. The middle value in an ordered array of numbers is called the _______.

E A. mode
Term B. mean
C. median
D. coefficient of variation

B 10. Another term for average is _______.

E A. mode
Term B. mean
C. median

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D. variance
C 11. The Greek letter μ usually refers to the _______.

E A. population standard deviation

Term B. sample variance
C. population mean
D. sample mean
A 12. The Greek letter σ usually refers to the _________.

E A. population standard deviation

Term B. sample variance
C. population mean
D. sample mean

D 13. The notation usually refers to the _______________.

E A. population standard deviation

Term B. sample variance
C. population mean
D. sample mean

B 14. The notation S2 usually refers to the _______________.

E A. population standard deviation

Term B. sample variance
C. population mean
D. sample mean

D 15. Which of the following is NOT a commonly used measure of variability?

M A. variance
Term B. standard deviation
C. mean absolute deviation
D. average deviation

A 16. The sum of deviations about the arithmetic mean is always equal to _______.

E A. zero
Term B. the variance
C. the mean absolute deviation
D. the standard deviation
C 17. The average of the squared deviations from the arithmetic mean is called the
_______.

M A. standard deviation
Term B. mean absolute deviation

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C. variance
D. coefficient of variation

B 18. The sample variance is found by taking the square root of _______.

E A. the sample mean

Term B. the sample variance
C. the coefficient of variation
D. the mean absolute deviation

C 19. The lowest appropriate level of measurement for standard deviation is

_________.

E A. nominal
Term B. ordinal
C. interval
D. ratio

B 20. The lowest appropriate level of measurement for the Interquartile Range is
_________.

E A. nominal
Term B. ordinal
C. interval
D. ratio

D 21. The number of standard deviations that a value (X) is above or below the mean is
the _________________.

M A. absolute deviation
Term B. coefficient of variation
C. interquartile range
D. Z score

D 22. If the mean of a distribution is greater than the median, then the distribution is
______.

M A. not skewed
Term B. symmetrical about its mean
C. skewed to the left
D. skewed to the right
C 23. If the median of a distribution is greater than mean, then the distribution is
_________.

M A. not skewed
Term B. symmetrical about its mean

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C. skewed to the left

D. skewed to the right

D 24. The interquartile range is _____________.

E A. the largest value minus the least value

Term B. the ratio of the mean to the standard deviation
C. negative if the distribution is skewed to the left
D. Q3- Q1

B 25. The five numbers used to construct a box and whisker plot are _______.

M A. the mean, standard deviation, Q1, Q3, and the coefficient of variation
Term B. Q1, Q2, Q3, the least value of X, and the largest value of X
C. the mean, standard deviation, least value of X, largest value of X, and Q2
D. the coefficient of variation, IQR, mean, Q2, and mean absolute deviation

D 26. Which of the following is a measure of relative dispersion?

M A. standard deviation
Term B. interquartile range
C. mean absolute deviation
D. coefficient of dispersion
A 27. The empirical rule says that approximately what percentage of the values would
be within 2 standard deviations of the mean in a bell shaped set of data?

M A. 95%
Term B. 68%
C. 50%
D. almost all

B 28. The empirical rule says that approximately what percentage of the values would
be within 1 standard deviation of the mean in a bell shaped set of data?

M A. 95%
Term B. 68%
C. 50%
D. almost all
A 29. Chebyshev's Theorem says that how many values will be within 2 standard
deviations of the mean?

H A. at least 75%
Calc B. at least 68%
C. at least 95%
D. at least 89%

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D 30. Chebyshev's Theorem says that the number of values within 3 standard deviations
of the mean will be _______.

M A. at least 75%
Calc B. at least 68%
C. at least 95%
D. at least 89%

B 31. A statistics student made the following grades on 5 tests: 84, 78, 88, 78, and 72.
What is the mean grade?

M A. 78
Calc B. 80
C. 72
D. 84

C 32. A statistics student made the following grades on 5 tests: 84, 78, 88, 72, and 72.
What is the median grade?

M A. 88
Calc B. 72
C. 78
D. 80

A 33. A statistics student made the following grades on 5 tests: 84, 78, 88, 78, and 82.
What is the mode?

E A. 78
Calc B. 80
C. 88
D. 84

D 34. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 34, 39, 41, 35,
and 41. The mean time required for this trip was _______.

M A. 35
Calc B. 41
C. 37.5
D. 38

A 35. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 34, 39, 41, 35,
and 41. The median time required for this trip was _______.

M A. 39

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Calc B. 41
C. 37.5
D. 38

B 36. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 34, 39, 41, 35,
and 41. The modal time required for this trip was _______.

E A. 39
Calc B. 41
C. 37.5
D. 38

B 37. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 44, 39, 41, 35,
and 41. The mean time required for this trip was 40 minutes. What is the variance for this
sample data?

H A. 8.8
Calc B. 11
C. 0
D. 3
A 38. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 44, 39, 41, 35,
and 41. The mean time required for this trip was 40 minutes. What is the standard deviation for
this sample data?

H A. 3.32
Calc B. 2.97
C. 1.73
D. 11

D 39. A commuter travels many miles to work each morning. She has timed this trip 5
times during the last month. The time (in minutes) required to make this trip was 44, 39, 41, 35,
and 41. The mean time required for this trip was 40 minutes. What is the mean absolute
deviation for this sample data?

H A. 0
Calc B. 12
C. 3
D. 2.4

D 40. Abel Alonzo, Director of Human Resources, is exploring employee absenteeism

at the Batesville Bottling during the last operating year. A sample of six personnel records
produced the following data: 0, 2, 4, 7, 2, 9.
The mean number absences per employee is ____________.

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M A. 3
BCalc B. 2
C. 5.5
D. 4

B 41. Abel Alonzo, Director of Human Resources, is exploring employee absenteeism

at the Batesville Bottling during the last operating year. A sample of six personnel records
produced the following data: 0, 2, 4, 7, 2, 9.
The modal number absences per employee is ____________.

E A. 3
BCalc B. 2
C. 5.5
D. 4

A 42. Abel Alonzo, Director of Human Resources, is exploring employee absenteeism

at the Batesville Bottling during the last operating year. A sample of six personnel records
produced the following data: 0, 2, 4, 7, 2, 9.
The median number absences per employee is ____________.

M A. 3
BCalc B. 2
C. 5.5
D. 4

A 43. Abel Alonzo, Director of Human Resources, is exploring employee absenteeism

at the Batesville Bottling during the last operating year. A sample of six personnel records
produced the following data: 0, 2, 4, 7, 2, 9.
The variance of the number absences per employee is ____________.

H A. 11.6
BCalc B. 9.67
C. 3.41
D. 3.11

C 44. Abel Alonzo, Director of Human Resources, is exploring employee absenteeism

at the Batesville Bottling during the last operating year. A sample of six personnel records
produced the following data: 0, 2, 4, 7, 2, 9.
The standard deviation of the number absences per employee is ____________.

H A. 11.6
BCalc B. 9.67
C. 3.41
D. 3.11

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A 45. The mean life of a particular brand of light bulb is 1000 hours and the standard
deviation is 50 hours. It can be concluded that at least 75% of the bulbs will last between
_______.

H A. 900 and 1100 hours

BCalc B. 950 and 1050 hours
C. 850 and 1150 hours
D. 800 and 1200 hours

C 46. The mean life of a particular brand of light bulb is 1000 hours and the standard
deviation is 50 hours. It can be concluded that at least 89% of the bulbs will last between
_______.

H A. 900 and 1100 hours

BCalc B. 950 and 1050 hours
C. 850 and 1150 hours
D. 800 and 1200 hours
B 47. The mean life of a particular brand of light bulb is 1000 hours and the standard
deviation is 50 hours. Tests show that the life of the bulb is approximately normally distributed.
It can be concluded that approximately 68% of the bulbs will last between _______.

M A. 900 and 1100 hours

Calc B. 950 and 1050 hours
C. 850 and 1150 hours
D. 800 and 1200 hours
A 48. Jessica Salas, president of Salas Products, is reviewing the warranty policy for her
company's new model of automobile batteries. Life tests performed on a sample of 100 batteries
indicated: (1) an average life of 75 months, (2) a standard deviation of 5 months, and (3) battery
life is approximately normally distributed. Approximately 68% of the batteries will last between
________________.

M A. 70 and 80 months
BCalc B. 60 and 90 months
C. 65 and 85 months
D. 55 and 95 months

C 49. Jessica Salas, president of Salas Products, is reviewing the warranty policy for her
company's new model of automobile batteries. Life tests performed on a sample of 100 batteries
indicated: (1) an average life of 75 months, (2) a standard deviation of 5 months, and (3) battery
life is approximately normally distributed. Approximately 95% of the batteries will last between
________________.

M A. 70 and 80 months
BCalc B. 60 and 90 months
C. 65 and 85 months
D. 55 and 95 months

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B 50. Jessica Salas, president of Salas Products, is reviewing the warranty policy for her
company's new model of automobile batteries. Life tests performed on a sample of 100 batteries
indicated: (1) an average life of 75 months, (2) a standard deviation of 5 months, and (3) battery
life is approximately normally distributed. Approximately 99% of the batteries will last between
________________.

M A. 70 and 80 months
BCalc B. 60 and 90 months
C. 65 and 85 months
D. 55 and 95 months

C 51. Jessica Salas, president of Salas Products, is reviewing the warranty policy for her
company's new model of automobile batteries. Life tests performed on a sample of 100 batteries
indicated: (1) an average life of 75 months, (2) a standard deviation of 5 months, and (3) battery
life is approximately normally distributed. What percentage of the batteries will fail within the
first 65 months of use?

H A. 0.5%
BCalc B. 1%
C. 2.5%
D. 5%

B 52. The average starting salary for graduates at a university is $25,000 with a standard
deviation of $2,000. If a histogram of the data shows the it takes on a mound shape, the
empirical rule says that approximately 95% of the graduates would have a starting salary
between _______.

M A. 23,000 and 27,000

BCalc B. 21,000 and 29,000
C. 19,000 and 31,000
D. 24,000 and 26,000

A 53. The average starting salary for graduates at a university is $25,000 with a standard
deviation of $2,000. If a histogram of the data shows the it takes on a mound shape, the
empirical rule says that approximately 68% of the graduates would have a starting salary
between _______.

M A. 23,000 and 27,000

BCalc B. 21,000 and 29,000
C. 19,000 and 31,000
D. 24,000 and 26,000

A 54. The average starting salary for graduates at a university is $25,000 with a standard
deviation of $2,000. A histogram of the data shows the shape to be very erratic so Chebyshev's

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Theorem should be used. How many of the graduates would have a starting salary between
21,000 and 29,000?

H A. at least 75%
BCalc B. at least 89%
C. at least 68%
D. at least 95%

B 55. The average starting salary for graduates at a university is $25,000 with a standard
deviation of $2,000. A histogram of the data shows the shape to be very erratic so Chebyshev's
Theorem should be used. How many of the graduates would have a starting salary between
19,000 and 31,000?

H A. at least 75%
BCalc B. at least 89%
C. at least 68%
D. at least 95%

B 56. The ages of students in a class have been put into the frequency distribution
below.
Age Number of Students
18 3
19 5
20 28
21 4
What is the average age of these students?

M A. 19.50
Calc B. 19.85
C. 20.00
D. 28.00

B 57. The ages of students in a class have been put into the frequency distribution
below.
Age Number of Students
18 3
19 5
20 28
21 4
What is the standard deviation for this (population) set of data?

H A. 0.494
Calc B. 0.703
C. 1.12
D. 1.25

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D 58. The ages of students in a class have been put into the frequency distribution
below.
Age Number of Students
18 3
19 5
20 28
21 4
What is the median age of these students?

M A. 18
Calc B. 19
C. 19.5
D. 20

C 59. The ages of students in a class have been put into the frequency distribution
below.
Age Number of Students
18 3
19 5
20 28
21 4
What is the modal age of these students?

E A. 18
Calc B. 19
C. 20
D. 21

A 60. The mean, median, and mode for the following set of data are all the same value
(20). Data: 18, 19, 20, 20, 21, 22. If the highest number were changed from 22 to 322, which of
the following would be most affected?

M A. mean
App B. median
C. mode
D. sample size

C 61. In its Industry Norms and Key Business Ratios, Dun & Bradstreet reported that
Q1, Q2, and Q3for 577 motorcycle dealers' current ratios were 1.3, 1.6 and 2.9, respectively.
From this we can conclude that __________________.

M A. 68% of these dealers had current ratios between 1.3 and 2.9
BApp B. 95% of these dealers had current ratios between 1.3 and 2.9
C. 50% of these dealers had current ratios between 1.3 and 2.9
D. 75% of these dealers had current ratios between 1.3 and 2.9

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C 62. An instructor is evaluating the performance of students on a test. He records the

number of points that each student missed and created a frequency distribution. This is provided
below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the mean number of points missed?

H A. 20
Calc B. 25
C. 29
D. 30

C 63. An instructor is evaluating the performance of students on a test. He records the

number of points that each student missed and created a frequency distribution. This is provided
below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the variance for this population?

H A. 11.43
Calc B. 135.17
C. 130.67
D. 200

D 64. In its Industry Norms and Key Business Ratios, Dun & Bradstreet reported that
Q1, Q2, and Q3for 577 motorcycle dealers' current ratios were 1.3, 1.6 and 2.9, respectively.
From this we can conclude that __________________.

M A. 68% of these dealers had current ratios of 1.6 or less

BApp B. 95% of these dealers had current ratios of 2.9 or less
C. 50% of these dealers had current ratios of 2.9 or more
D. 75% of these dealers had current ratios of 1.3 or more

A 65. An instructor is evaluating the performance of students on a test. He records the

number of points that each student missed and created a frequency distribution. This is provided
below:
Points missed Number of students
0-under 10 2

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10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the standard deviation for this population?

H A. 11.43
Calc B. 14.14
C. 11.63
D. 135.17

C 66. An instructor is evaluating the performance of students on a test. He records the

number of points that each student missed and created a frequency distribution. This is provided
below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
If this is considered a sample, what is the standard deviation?

H A. 11.43
Calc B. 14.14
C. 11.63
D. 135.17

D 67. Which of the following is always true?

E A. the median is always one-half of the mean

Term B. the mode is always greater than the mean
C. the mean is always equal to the median
D. the standard deviation is always the square root of the variance

A 68. Pinky Bauer, Chief Financial Officer of Harrison Haulers, Inc., suspects
irregularities in the payroll system, and orders an inspection of "each and every payroll voucher
issued since January 1, 1993." Each payroll voucher was inspected and the following frequency
distribution was compiled.
Errors Per Voucher Number of Vouchers
0-under 2 500
2-under 4 400
4-under 6 300
6-under 8 200
8-under 10 100
The mean number of errors per voucher is __________.

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H A. 3.67
BCalc B. 5
C. 750
D. 300

A 69. Pinky Bauer, Chief Financial Officer of Harrison Haulers, Inc., suspects
irregularities in the payroll system, and orders an inspection of "each and every payroll voucher
issued since January 1, 1993." Each payroll voucher was inspected and the following frequency
distribution was compiled.
Errors Per Voucher Number of Vouchers
0-under 2 500
2-under 4 400
4-under 6 300
6-under 8 200
8-under 10 100
The distribution of errors per voucher is __________.

M A. symmetrical with respect to its mean

BApp B. skewed to the right
C. not skewed
D. negatively skewed

C 70. A sales manager has sampled past sales records to determine how many
refrigerators are sold each day. Daily records for a sample of 10 days have been selected. The
sales on these days are: 0, 4, 4, 2, 1, 3, 4, 5, 2, 7. What is the mean daily sales?

M A. 2
BCalc B. 4
C. 3.2
D. 10

C 71. A sales manager has sampled past sales records to determine how many
refrigerators are sold each day. Daily records for a sample of 10 days have been selected. The
sales on these days are: 0, 4, 3, 2, 1, 3, 5, 5, 2, 5. What is the median daily sales?

M A. 3.5
BCalc B. 2
C. 3
D. 4

D 72. A sales manager has sampled past sales records to determine how many
refrigerators are sold each day. Daily records for a sample of 10 days have been selected. The
sales on these days are: 0, 4, 4, 2, 1, 3, 4, 5, 2, 7. The mode of data set is ______.

E A. 3.5
BCalc B. 2

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C. 3
D. 4
B 73. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the mean for this set of data?

E A. 2
BCalc B. 4
C. 5
D. 4.5

A 74. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the mode for this set of data?

E A. 2
BCalc B. 4
C. 5
D. 4.5

A 75. In its Industry Norms and Key Business Ratios, Dun & Bradstreet reported that
Q1, Q2, and Q3for 577 motorcycle dealers' current ratios were 1.3, 1.6 and 2.9, respectively.
From this we can conclude that __________________.

E A. 50% of these dealers had current ratios of 1.6 or less

BApp B. 68% of these dealers had current ratios of 1.3 or less
C. 50% of these dealers had current ratios of 2.9 or more
D. 95% of these dealers had current ratios of 1.3 or more

C 76. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the standard deviation for this set of sample data?

M A. 2
BCalc B. 0
C. 2.12
D. 4.5

B 77. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the variance for this set of sample data?

M A. 4
BCalc B. 4.5
C. 2
D. 0

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B 78. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the median for this set of data?

E A. 2
BCalc B. 4
C. 5
D. 4.5

C 79. A sales manager has sampled past sales records to determine how many
televisions are sold each day. Daily records for a sample of 5 days have been selected. The sales
on these days are: 2, 4, 5, 2, 7. What is the mean absolute deviation for this set of data?

M A. 0
BCalc B. 2
C. 1.6
D. 4

D 80. Consider the following 3 numbers: 10, 20, 30. In calculating measures of central
tendency and variability for this set of data, which of the following is true?

M A. you can calculate the mean only if you know if this is a sample or a population
App B. you can calculate the median only if you know if this is a sample or a
population
C. you can calculate the mode only if you know if this is a sample or a population
D. you can calculate the variance only if you know if this is a sample or a
population

C 81. Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the
following performance statistics for two new stocks.
Rate of Return
Standard Deviation
Salas Products, Inc.
Hot Boards, Inc.
The coefficient of variation for Salas Products, Inc. is __________.

E A. 300%
BCalc B. 100%
C. 33%
D. 5%

B 82. The following box and whisker plot was constructed for the age of accounts
receivable.

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The box and whisker plot reveals that the accounts receivable ages are _______.

E A. skewed to the left

BApp B. skewed to the right
C. not skewed
D. normally distributed

A 83. The following box and whisker plot was constructed for the age of accounts
receivable.

The box and whisker plot reveals that the accounts receivable ages are _______.

E A. skewed to the left

BApp B. skewed to the right
C. not skewed
D. normally distributed

A 84. The following frequency distribution was constructed for the age of accounts
receivable.

The frequency distribution reveals that the accounts receivable ages are _______.

E A. skewed to the left

BApp B. skewed to the right
C. not skewed
D. normally distributed

B 85. The following frequency distribution was constructed for the age of accounts
receivable.

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The frequency distribution reveals that the accounts receivable ages are _______.

E A. skewed to the left

BApp B. skewed to the right
C. not skewed
D. normally distributed

B 86. Liz Chapa manages a portfolio of 250 common stocks. Her staff compiled the
following performance statistics for two new stocks.
Rate of Return
Standard Deviation
Salas Products, Inc.
Hot Boards, Inc.
The coefficient of variation for Salas Products, Inc. is __________.

M A. equal to the coefficient of variation for Hot Boards

BCalc B. greater than the coefficient of variation for Hot Boards
C. less than the coefficient of variation for Hot Boards
D. 25%

D 87. David Desreumaux, VP of Human Resources of American First Banks (AFB), is

reviewing the employee training programs of AFB banks. His staff compiled the following table
of regional statistics on teller training hours.
Southeast Region Southwest Region
20 28
20 20
20 21
Standard Deviation 5 7
What can David conclude from these statistics?

M A. the Southeast distribution is skewed to the left

BApp B. the Southeast distribution is skewed to the right
C. the Southwest distribution is skewed to the left
D. the Southwest distribution is skewed to the right

A 88. David Desreumaux, VP of Human Resources of American First Banks (AFB), is

reviewing the employee training programs of AFB banks. His staff compiled the following table
of regional statistics on teller training hours.
Southeast Region Southwest Region
20 28
20 20

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20 21
Standard Deviation 5 7
What can David conclude from these statistics?

M A. the Southwest distribution has the greater dispersion

BApp B. the Southwest distribution is skewed to the left
C. the Southeast distribution has the greater dispersion
D. the Southeast distribution is skewed to the left

D 89. David Desreumaux, VP of Human Resources of American First Banks (AFB), is

reviewing the employee training programs of AFB banks. His staff compiled the following table
of regional statistics on teller training hours.
Southeast Region Southwest Region
20 28
20 20
20 21
Standard Deviation 5 7
What can David conclude from these statistics?

M A. the Southwest distribution has the greater relative dispersion

BApp B. the Southwest distribution is skewed to the left
C. the Southeast distribution has the greater relative dispersion
D. the Southeast distribution is not skewed

D 90. Manuel Banales, Marketing Director of Plano Power Plants, Inc.’s Electrical
Division, is leading a study to assess the relative importance of product features. Two items on a
survey questionnaire distributed to 100 of Plano’s customers asked them to rate the importance
of “ease of maintenance” and “efficiency of operation” on a scale of 1 to 10 (with 1 meaning
“not important” and 10 meaning “highly important”). His staff assembled the following statistics
on these two items.
Ease of Maintenance Efficiency of Operation
7.5 6.0
8.5 5.5
9.0 4.5
Standard Deviation 1.5 2.5
What can Manuel conclude from these statistics?

M A. the Ease of Maintenance distribution is skewed to the right

BApp B. the Ease of Maintenance distribution is not skewed
C. the Efficiency of Operation distribution is skewed to the left
D. the Efficiency of Operation distribution is positively skewed

B 91. Manuel Banales, Marketing Director of Plano Power Plants, Inc.’s Electrical
Division, is leading a study to assess the relative importance of product features. Two items on a
survey questionnaire distributed to 100 of Plano’s customers asked them to rate the importance

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of “ease of maintenance” and “efficiency of operation” on a scale of 1 to 10 (with 1 meaning

“not important” and 10 meaning “highly important”). His staff assembled the following statistics
on these two items.
Ease of Maintenance Efficiency of Operation
7.5 6.0
8.5 5.5
9.0 4.5
Standard Deviation 1.5 2.5
What can Manuel conclude from these statistics?

M A. the Ease of Maintenance distribution has more relative dispersion

BApp B. the Ease of Maintenance distribution has less dispersion
C. the Efficiency of Operation distribution is skewed to the left
D. the Efficiency of Operation distribution has less dispersion

A 92. Manuel Banales, Marketing Director of Plano Power Plants, Inc.’s Electrical
Division, is leading a study to assess the relative importance of product features. Two items on a
survey questionnaire distributed to 100 of Plano’s customers asked them to rate the importance
of “ease of maintenance” and “efficiency of operation” on a scale of 1 to 10 (with 1 meaning
“not important” and 10 meaning “highly important”). His staff assembled the following statistics
on these two items.
Ease of Maintenance Efficiency of Operation
7.5 6.0
8.5 5.5
9.0 4.5
Standard Deviation 1.5 2.5
What can Manuel conclude from these statistics?

M A. Ease of Maintenance is more important than Efficiency of Operation

BApp B. Efficiency of Operation is more important than Ease of Maintenance
C. Efficiency of Operation and Ease of Maintenance are equally important
D. the Efficiency of Operation distribution has less dispersion

B 93. In its Industry Norms and Key Business Ratios, Dun & Bradstreet reported that
Q1, Q2, and Q3for 2,037 gasoline service stations' sales to inventory ratios were 20.8, 33.4, and
53.8, respectively. From this we can conclude that ____________.

E A. 68% of these service stations had sales to inventory ratios of 20.8 or less
BApp B. 50% of these service stations had sales to inventory ratios of 33.4 or less
C. 50% of these service stations had sales to inventory ratios of 53.8 or more
D. 95% of these service stations had sales to inventory ratios of 20.8 or more
A 94. Albert Abbasi, VP of Operations at Ingleside International Bank, is evaluating the
service level provided to walk-in customers. Accordingly, his staff prepared the following
distribution of waiting time for walk-in customers.
Waiting Time Number of Customers
(in minutes)

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0-under 2 60
2-under 4 30
4-under 6 10
The mean waiting time for this sample of walk-in customers is _________.

H A. 2 minutes
BCalc B. 66.67 minutes
C. 33.33 minutes
D. 3 minutes

B 95. Albert Abbasi, VP of Operations at Ingleside International Bank, is evaluating the

service level provided to walk-in customers. Accordingly, his staff prepared the following
distribution of waiting time for walk-in customers.
Waiting Time Number of Customers
(in minutes)
0-under 2 60
2-under 4 30
4-under 6 10
The standard deviation of waiting time for this sample of walk-in customers is
______.

H A. 2 minutes
BCalc B. 1.35 minutes
C. 1.82 minutes
D. 1.80 minutes

C 96. David Desreumaux, VP of Human Resources of American First Banks (AFB), is

reviewing the employee training programs of AFB banks. His staff reports several statistics for
teller training hours. The mean is 20 hours, the standard deviation is 5 hours, the median is 15
hours, and mode is 10 hours.
The Pearsonian coefficient of skewness for teller training hours is __________.

M A. 6
BCalc B. 1
C. 3
D. 4

C 97. The following box and whisker plot was constructed for the age of accounts
receivable.

The box and whisker plot reveals that the accounts receivable ages are _______.

E A. skewed to the left

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BApp B. skewed to the right

C. not skewed
D. normally distributed

C 98. The following frequency distribution was constructed for the age of accounts
receivable.

The frequency distribution reveals that the accounts receivable ages are _______.

E A. skewed to the left

BApp B. skewed to the right
C. not skewed
D. positively skewed

A 99. Which Excel function returns the second quartile?

E A. median()
Term B. mode()
C. max()
D. quart2()

B 100. Which Excel function returns the population standard deviation?

M A. pstdev()
Term B. stdevp()
C. stdev()
D. stdevpop()

C 101. Which Excel function returns the sample standard deviation?

M A. sstdev()
Term B. stdevs()
C. stdev()
D. stdevsample()

D 102. Which Excel function returns the arithmetic mean?

M A. amean()
Term B. meana()
C. mean()
D. average()

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103. Albert Abbasi, VP of Operations at Ingleside International Bank (IIB), is

evaluating the service level provided to walk-in customers. Accordingly, his staff prepared the
following distribution of waiting time for walk-in customers.
Waiting Time Number of Customers
(in minutes)
0-under 2 120
2-under 4 40
4-under 6 25
6-under 8 10
8-under 10 5
In a recent survey, 70% of the walk-in customers indicated that waiting four
minutes (or more) was unacceptable. Presently, IIB has no direct competitors, but a competing
bank is under construction across the street.

Discuss the managerial and business implications of this situation. What

alternatives should Albert consider? What graphic depiction should he choose for his
presentation to the bank’s board of directors?

M _________________________________________________________________
BApp _________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________

104. Angelina Arnott, Director of National Industrial Sales, is concerned by a

deteriorating sales trend. Specifically, the number of customers is stable at 1,500, but they are
purchasing less each year. She orders her staff to search for causes of the downward trend by
surveying all 1,500 industrial customers. One question on the survey asked the customers to rate
“Merchandise is delivered on time” on a scale of 1 to 5, with 1 meaning “never” and 5 meaning
“always”.
Merchandise Delivered On Time Number of Customers
1 100
2 200
3 300
4 700
5 100
No Response 100

Discuss the managerial and business implications of Angelina’s situation.

Identify some possible causes of the trend. What corrective actions are available for each
cause? What graphic depiction(s) should she choose for her report to the VP of Marketing?

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M _________________________________________________________________
BApp _________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
105. Annualized rates of return were calculated from closing prices of
Caterpillar (CAT) and General Mills (GIS) common stock. Descriptive statistics of these rates of
return presented in the following table.

CAT GIS
Mean 0.233621705 0.139744793
Standard Error 0.162775427 0.097267227
Median 0.194367839 0.122108626
Mode #N/A 0
Standard 1.091930758 0.652488394
Deviation
Sample Variance 1.19231278 0.425741105
Kurtosis 6.478114897 -0.59713571
Skewness 1.647492156 0.058132445
Range 6.669350226 2.710777183
Minimum -1.770866463 -1.256246317
Maximum 4.898483762 1.454530866
Sum 10.51297674 6.288515695
Count 45 45

Describe what these descriptive statistics reveal about the market performance of
these two stocks.
M
BApp

106. Descriptive statistics of daily sales ($'s) were calculated for two Bob's Quick
Shops -- the Southside store, and the Midcity store.

Southsid Midcity
e
Mean 5025.622 2733.333
Standard Error 118.306 249.1417
Median 5110.73 2000
Mode #N/A 1000
Standard Deviation 916.394 1929.843
Sample Variance 839778 3724294

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Kurtosis -0.64387 -0.49322

Skewness -0.05517 0.860968
Range 3949.172 6000
Minimum 3133.362 1000
Maximum 7082.534 7000
Sum 301537.3 164000
Count 60 60

Describe what these descriptivie statistics indicate about daily sales at these two
stores.
M
BApp

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