(ISOM2500)[2020](f)midterm1~=lt3a44^_56231.pdf downloaded by lcyeungad from http://petergao.net/ustpastpaper/down.php?course=ISOM2500&id=14 at 2021-10-04 13:54:50. Academic use within HKUST only.

The Hong Kong University of Science and Technology

Department of ISOM
ISOM 2500 Business Statistics
(2020 Fall)
Sample Quiz 1

1. The following bar chart describes the results of a survey concerning the relevance of study to
present job by school.

Focus on the School of Business and Management. What are the mode and the median
respectively?
A. Relevant, Neutral
B. Relevant, Relevant
C. Neutral, Relevant
D. Neutral, Neutral

2. A survey on all the fires in a big city in the last ten years is conducted, and the relationship
between the number of fire engines at each fire and the damages in dollars at each fire is studied.
It is found that the number of fire engines and the amount of damages is strongly positively
correlated. Based on this finding, which of the following statements is correct?
A. More fire engines cause bigger damages
B. Bigger damages cause more fire engines
C. Big damages are typically accompanied with small number of fire engines
D. None of the above
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3. How will you describe the following histogram?

I. Unimodal
II. Symmetric
III. Bell-shaped
IV. Skew to the right
A. I, III, IV
B. I, II
C. I, II, III
D. I, IV

4. When you want to investigate how studying affects academic results, which tool should you use?
A. Histogram
B. Pie Chart
C. Scatter Plot
D. Box Plot

5. Which of the followings is/are correct description(s) of using range to measure variation?
I. Measure the interval spanned by all data
II. Simplest method to measure variation
III. Show how data are distributed
A. I only
B. I and III only
C. I and II only
D. All of the above descriptions are correct.

6. The smaller the spread of scores around the mean,

A. the smaller the interquartile range.
B. the smaller the standard deviation.
C. the smaller the coefficient of variation.
D. The smaller all of the interquartile range, standard deviation and coefficient of variation.
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7. The following figure is a sketched histogram of household income data for a city. For this data
set, which of the following is true?

Hi st og ra m of X

30

25

20
Frequency

15

10

0
0.0 1.5 3.0 4.5 6.0 7.5
X

A. Mean<Median<Mode
B. Mode<Median<Mean
C. Class length is 1
D. The distribution is left skewed

8. A fair coin is repeatedly tossed, and the coin lands heads in all the first 5 tosses. Which of the
following statements concerning the 6th toss is true?
A. The coin is less likely to land heads than to land tails.
B. The coin is more likely to land heads than to land tails.
C. The coin is equally likely to land heads as tails.
D. None of the above.
(ISOM2500)[2020](f)midterm1~=lt3a44^_56231.pdf downloaded by lcyeungad from http://petergao.net/ustpastpaper/down.php?course=ISOM2500&id=14 at 2021-10-04 13:54:50. Academic use within HKUST only.

[9-10].The following data has been collected on employees at a company who have been terminated after
less than one year with the company:

Gender
Man Woman
U.S.A. 15 15 30
Citizenship
Foreign 25 5 30
40 20 60

9. Suppose the terminations of employees in less than one year occur independently of one another.
Based on the data, what is the probability that the next 3 terminations will be women from the
U.S.A?
A. 1/64
B. 3/4
C. 1/216
D. 2/3

10. What is the Crammer’s V between gender and citizenship?

A. 7.5
B. 0
C. 0.354
D. 0.125

11. A student is confused with 3 multiple choices (Single answer) questions that he has no idea about.
Each question has 4 possible answers. On each question he chooses an answer at random, without
regard to how he answered the other questions. The chance that among these questions he gets at
least one question wrong is closest to:
A. 0%
B. 25%
C. 75%
D. 100%

12. A game involving chance is said to be a fair game if the expected amount won or lost is zero.
Consider the following arcade game. A player pays $1 and chooses a number from 1 to 10. A
spinning wheel then randomly selects a number from 1 to 10. If the numbers match, the player
wins $x (and gets his/her $1 back); otherwise the players loses the $1 entry fee. What value
should x be so that the game is fair?
A. 1
B. 5
C. 9
D. 10
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13. Two adjacent bakeries sell the same and only one type of cake. Every day, the amount of cakes
that each bakery sells has a mean of (X) and SD of (Y). If the two bakeries combine into one,
what is the new SD? (assuming that two bakeries sells are independent)
A. 2Y
B. Y
C. √2Y
D. 4Y

14. A construction company has bid on two contracts, A and B. Define event A= win contract A; B =
win contract B. Following is a tree diagram showing the related probabilities.

Which of the following statement is not correct?

A. The probability of winning contract A is 0.3.
B. If the company wins contract A, then the probability of winning contract B is 0.4.
C. If the company loses contract A, then the probability of winning contract B decreases to
0.2.
D. The probability of winning exactly one contract is 0.5.

15. Suppose that events A and B have probabilities 0.5 and 0.6 respectively. Which of the following
statements is FALSE?
A. 𝑃(𝐴𝑐 ) = 0.5.
B. It is possible that A and B are mutually exclusive.
C. It is possible that A and B are dependent.
D. It is possible that 𝑃(𝐴 ∪ 𝐵) = 0.6.

16. A professor gives a quiz with 10 multiple choice questions. After grading the papers, the
professor writes down for each student the number of questions the student got right and the
number wrong. The average number of right answer is 8.13 with SD of 1.1. What are the average
and standard deviation (SD) of the number of wrong answer?
A. 1.87, 1.1
B. 1.87, 8.9
C. 8.13, 1.1
D. 7.13, 8.9
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17. A regional manager for a chain of discount tire stores collected data from 30 stores over a 2-year
period (24 months). The data consist of the monthly amount, 𝐴, of dollars spent on advertising by
each store, and the dollar amount of sales revenue, 𝑅, for each store during the month. The
manager plans to use this data to investigate the association between these two variables. The
sample correlation 𝑟 = 0.85.
If instead of using dollars as the units for monthly sales revenue, the manager decides to record
the monthly sales revenues in terms of thousands of dollars, and then determine the correlation
between 𝐴 and 𝑅. This change in the units for 𝑅 will cause which of the following:
A. The sample correlation between the variables will increase from the value previously
computed
B. The sample correlation between the variables will decrease from the value previously
computed.
C. There will be no association between 𝐴 and 𝑅.
D. The sample correlation between the variables will be unchanged from the value
previously computed.

18. The following probability distribution of the monthly incomes (x in $1000) of account executives
has been estimated for a big accounting firm.

𝑥 12 14 20 22 30
𝑝(𝑥) 0.15 0.15 0.4 0.2 0.1
What is the expected value of the monthly incomes?
A. $19.3
B. $19,300
C. $19,600
D. $5.0309

19. Here are two summary of daily return of the two single stock portfolios (risk free rate= 0.015)
mean variance standard deviation

IBM 0.10 2.00 1.41

Apple 0.20 2.24 1.50

What is the Sharpe ratio of these two portfolio?

A. Sharpe ratio of IBM = 0.04913, Sharpe ratio of Apple = 0.2233
B. Sharpe ratio of IBM = 0.06028, Sharpe ratio of Apple = 0.1233
C. Sharpe ratio of IBM = 0.04913, Sharpe ratio of Apple = 0.1233
D. Sharpe ratio of IBM = 0.06028, Sharpe ratio of Apple = 0.2233

20. The price-earnings ratios of a sample of stocks have a mean value of 13.5 and a standard
deviation of 2. If the ratios have a bell shaped distribution, what can we say about the proportion
of ratios that fall between 11.5 and 15.5?
A. The interval contains approximately 60% of the ratios, according to the Empirical Rule
B. The interval contains approximately 68% of the ratios, according to the Empirical Rule
C. The interval contains approximately 64% of the ratios, according to the Empirical Rule
D. The interval contains approximately 95% of the ratios, according to the Empirical Rule