Final Exam
Final Exam
Final Exam
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TRUE/FALSE.
2. When developing a confidence interval estimate, the confidence level is calculated based on the
size of the sample and the population standard deviation.
3. If the probability of a Type I error is set at 0.05, then the probability of a Type II error will be 0.95.
4. A local pizza company is interested in estimating the percentage of customers who would take
advantage of a coupon offer. To do this, they give the coupon out to a random sample of 100
customers. Of these, 45 actually use the coupon. Based on a 95 percent confidence level, the upper
and lower confidence interval limits are approximately 0.3525 to 0.5475.
5. When a decision maker determines the required sample size for estimating a population mean, a
change in the confidence level will result in a change in the required sample size, provided that the
margin of error is also modified accordingly.
6. When the decision maker has control over the null and alternative hypotheses, the alternative
hypotheses should be the "research" hypothesis.
7. If a decision maker is concerned that the chance of making a Type II error is too large, one option
that will help reduce the risk is to reduce the significance level.
8. The population mean of income for adults in a particular community is known to be $28,600. Given
this information, the sampling distribution of values will be less than this depending on the size of
the sample used in developing the sampling distribution.
9. Assume that n = 18 people are asked a yes/no survey question, and 6 people say "yes" while 12
people say "no." Based on this information the sample proportion can be assumed normally
distributed.
10. In a particular city, the proportion of cars that would fail an air quality emissions test is thought to
be 0.13. Given this, the probability that a random sample of n = 200 cars will have a sample
proportion between 0.11 and 0.15 is approximately 0.60.
MULTIPLE CHOICE.
11. A population, with an unknown distribution, has a mean of 80 and a standard deviation of 7. For
a sample of 49, the probability that the sample mean will be larger than 82 is:
A) 0.5228 B) 0.9772 C) 0.4772 D) 0.0228
12. A particular subdivision has 20 homes. The number of people living in each of these homes is
listed as follows:
If a random sample of n = 3 homes were selected, what would be the highest possible positive
sampling error?
A) 6.0 B) 3.0 C) 0.5 D) 2.5
13. The Wisconsin Dairy Association is interested in estimating the mean weekly consumption of milk
for adults over the age of 18 in that state. To do this, they have selected a random sample of 300
people from the designated population. The following results were recorded:
Given this information, if the leaders wish to estimate the mean milk consumption with 90 percent
confidence, what is the approximate margin of error in the estimate?
A) z = 1.645 B) ±12.996 ounces C) ±0.456 ounce D) ±0.75 ounce
14. A popular restaurant takes a random sample n = 25 customers and records how long each occupied
a table. They found a sample mean of 1.2 hours and a sample standard deviation of 0.3 hour. Find
the 95 percent confidence interval for the mean.
A) 1.2 ± .118 B) 1.2 ± .124 C) 1.2 ± .588 D) 1.2 ± .609
15. A company that makes shampoo wants to test whether the average amount of shampoo per bottle
is 16 ounces. The standard deviation is known to be 0.20 ounces. Assuming that the hypothesis
test is to be performed using 0.10 level of significance and a random sample of n = 64 bottles,
which of the following would be the correct formulation of the null and alternative hypotheses?
A) H0 : 𝑥̅ = 16;HA : 𝑥̅ = 16
B) H0 : μ = 16;HA : μ ≠ 16
C) H0 : μ ≥ 16;HA : μ < 16
D) H0 : 𝑥̅ ≥ 16;HA : 𝑥̅ < 16
16. If an economist wishes to determine whether there is evidence that average family income in a
community near Seattle exceeds $125,000. An appropriate alternative hypothesis is:
A) μ = 125,000.
B) μ > 125,000.
C) μ ≤ 125,000.
D) μ ≥ 125,000.
17. A random sample of 340 people in Chicago showed that 66 listened to WJKT-1450, a radio station
in South Chicago Heights. Based on this information, what is the upper limit for the 95 percent
confidence interval estimate for the proportion of people in Chicago that listen to WJKT-1450?
A) 1.96 B) Approximately 0.0009 C) About 0.2361 D) About 0.2298
18. A major tire manufacturer wishes to estimate the mean tread life in miles for one of its tires. It
wishes to develop a confidence interval estimate that would have a maximum sampling error of
500 miles with 90 percent confidence. A pilot sample of n = 50 tires showed a sample standard
deviation equal to 4,000 miles. Based on this information, the required sample size is:
A) 124. B) 246. C) 174. D) 196.
19. Hillman Management Services manages apartment complexes in Tulsa, Oklahoma. They currently
have 30 units available for rent. The monthly rental prices (in dollars) for this population of 30
units are:
What is the range of possible sampling error if a random sample of size n = 6 is selected from the
population?
A) -194.33 to 225.67
B) -245.23 to 271.86
C) -184.15 to 215.61
D) -172.52 to 234.04
20. The State Department of Weights and Measures is responsible for making sure that commercial
weighing and measuring devices, such as scales, are accurate so customers and businesses are not
cheated. Periodically, employees of the department go to businesses and test their scales. For
example, a dairy bottles milk in 1-gallon containers. Suppose that if the filling process is working
correctly, the mean volume of all gallon containers is 1.00 gallon with a standard deviation equal
to 0.10 gallon. The department's test process requires that they select a random sample of n = 9
containers. If the sample mean is less than 0.97 gallons, the department will fine the dairy. Based
on this information, what is the probability that the dairy will get fined even when its filling process
is working correctly?
A) 0.90 B) Approximately 0.3159 C) About 0.1841 D) Approximately 0.3821
21. A company that makes shampoo wants to test whether the average amount of shampoo per bottle
is 16 ounces. The standard deviation is known to be 0.20 ounces. Assuming that the hypothesis test
is to be performed using 0.10 level of significance and a random sample of n = 64 bottles, how
large could the sample mean be before they would reject the null hypothesis?
A) 16.2 ounces
B) 16.049 ounces
C) 15.8 ounces
D) 16.041 ounces
22. A contract calls for the mean diameter of a cylinder to be 1.50 inches. As a quality check, each day
a random sample of n = 36 cylinders is selected and the diameters are measured. Assuming that the
population standard deviation is thought to be 0.10 inch and that the test will be conducted using
an alpha equal to 0.025, what would the probability of a Type II error be?
23. A house cleaning service claims that it can clean a four bedroom house in less than 2 hours. A
sample of n = 16 houses is taken and the sample mean is found to be 1.97 hours and the sample
standard deviation is found to be 0.1 hours. Using a 0.05 level of significance the correct conclusion
is:
A) reject the null because the test statistic (-1.2) is < the critical value (1.7531).
B) do not reject the null because the test statistic (1.2) is > the critical value (-1.7531).
C) reject the null because the test statistic (-1.7531) is < the critical value (-1.2).
D) do not reject the null because the test statistic (-1.2) is > the critical value (-1.7531).
CACULATION
1. Suppose it is known that the ages of all employees working for a very large computer company is
normally distributed with a mean of 44.2 and a standard deviation of 5.6 years. Given this
information, discuss what the sampling distribution for 𝑥̅ looks like?
2. In a recent audit report, an accounting firm stated that the mean sale per customer for the client
was estimated to be between $14.50 and $28.50. Further, this was based on a random sample of
100 customers and was computed using 95 percent confidence. Provide a correct interpretation of
this confidence interval estimate.