MEDITERRANEAN SCHOOL OF BUSINESS

Business Statistics (QMM 501)

Sampling Distributions: Solution

Problem 1

The fill amount of bottles of a soft drink is normally distributed, with a mean of 2.0 liters and a standard
deviation of 0.05 liter. If you select a random sample of 25 bottles, what is the probability that the
sample mean will be

0.05
As the fill amount of bottles is normally distributed, we have that X N (2 , =0.01)
√25

1. between 1.99 and 2.0 liters?

P ( 1.99< X <2 ) =P ( 1.99−2

0.01
<Z<
0.01 )
2−2
=P (−1< Z <0 )=P ( Z< 0 )−P ( Z ←1 )=P ( Z< 0 )−P ( Z >1 )=P ( Z< 0 )−

0.8413=0.3413
2. below 1.98 liters?

P ( X <1.98 )=P Z < ( 1.98−2

0.01 )
=P ( Z ←2 )=P ( Z >2 ) =1−P ( Z <2 )=1−.9772=0.0228

3. The probability is 99% that the sample mean amount of soft drink will be at least how much?
P ( X > X 0 )=.99

(
P Z>
X 0−2
0.01 )
=.99

X 0−2
Denote by Z 0=
0.01
P ( Z > Z 0 )=. 99
As Z 0 is negative and using the symmetry of the curve P ( Z ← Z 0 )=.99

From the standard normal table −Z 0=2.33 so Z 0=−2.33 and X 0=−2.33 ( 0.01 ) +2=1.9796

Problem 2

For the past few years, the number of customers of a drive-up bank in New York has averaged 20 per
hours, with a standard deviation of 3 per hour. Furthermore, it is assumed to be normally distributed.
This year, another bank 1 mile away opened a drive-up window. The manager of the first bank believes
 MEDITERRANEAN SCHOOL OF BUSINESS

Business Statistics (QMM 501)

that this will result in a decrease in the number of customers. He decided to record the number of
customers who arrived during 36 randomly selected hours. Table 1 shows the results.

Table 1. Descriptive Statistics

N Minimum Maximum Mean Std. Deviation
Customers 36 11 24 19,39 2,950
Valid N (listwise) 36

1. What is the sampling distribution of the mean of 36 randomly selected hours?

3
X N (20 , =0.5)
√36

2. Assume that the population mean and standard deviation are equal to 20 and 3, respectively.
What is the probability that the mean of 36 randomly selected hours is less or equal to 19.39?
Interpret.

(
P ( X ≤19.39 ) =P Z ≤
19.39−20
0.5 )
=P ( Z ≤−1.22 )=P ( Z ≥1.22 )=1−P ( Z <1.22 )=1−.8888=0.1112

There is 11.12% chance that the sample mean is less than or equal to 19.39 given that the
population mean is 20 and the population standard deviation is 3.
3. Use the result of question #2 to help the manager of the first bank.
As the probability obtained in question#2 is not negligible, we cannot conclude from the sample
selected that the mean number of customers arriving at the drive-through window has
decreased.

Problem 3

An automatic machine in a manufacturing process is operating properly if the lengths of an important

subcomponent are normally distributed with mean = 117 cm and standard deviation = 5.2 cm.

1. Find the probability that one selected subcomponent is longer than 120 cm.
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Business Statistics (QMM 501)

120−117
P ( X >120 )=P ¿ Z> ¿=P ( Z> 0.58 )=1−P ( Z< 0.58 )=1−.719=0.281
5.2
2. Find the probability that if four subcomponents are randomly selected, their mean length
exceeds 120 cm.
120−117
P ( X >120 )=P ¿ Z> ¿=P ( Z>1.15 )=1−P ( Z <1.15 ) =1−.8749=0.1251
5.2/ √ 4

3. Find the probability that if four subcomponents are randomly selected, all four have lengths
that exceed 120 cm.
4 4
(P ( X >120 ) ) =0.281 =0.00623

Problem 4

A university bookstore claims that 50% of its customers are satisfied with the service and prices.

1. If this claim is true, what is the probability that in a random sample of 600 customers less than
45% are satisfied?
np=300>5∧n ( 1− p )=300> 5

( )
0.45−0.5
P ( ^p < 0.45 )=P Z < =P ( Z ←2.45 ) =P ( Z> 2.45 )=1−P ( Z< 2.45 )=1−.9929=.0071

√ ( 0.5 ) ( 0.5 )
600
2. Suppose that in a random sample of 600 customers, 270 express satisfaction with the
bookstore. What does this tell you about the bookstore's claim?
270/600=0.45
The probability of selecting a sample with a sample proportion as extreme as 0.45 has been
computed in the previous question to be very low. It is thus almost impossible to select such a
sample. We conclude that the bookstore’s claim is wrong.

Problem 5

The number of pizzas consumed per month by university students is normally distributed with a mean of
10 and a standard deviation of 3.
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Business Statistics (QMM 501)

1. What proportion of students consume more than 12 pizzas per month?

2. What is the probability that in a random sample of 25 students more than 275 pizzas are
consumed?

Population: University students

Variable: number of pizzas consumed per month

Parameter: the mean number of pizza consumed per month

(
1. p ( x >12 )= p z >
12−10
3 )
=P ( z> 0.67 )=1−0 .7486=0.2514

25.14% of students consume more than 12 pizzas per month.

2. We need to compute the probability that the mean number of pizzas consumed is more than
275
=11
25

(
The number of pizzas consumed per month is normally distributed therefore, x N 10 ,
3
√ 25 )
x N ( 10,0.6 )

(
P ( x>11 ) =P Z>
11−10
0.6 )
=P ( Z >1.67 ) =1−0.9525=0.0475

Problem 6

The assembly line that produces an electronic component of a missile system has historically resulted in
a 2% defective rate. A random sample of 800 components is drawn.

np=800 ( .02 )=16>5∧n ( 1− p ) =800 ( .98 )=784> 5

 MEDITERRANEAN SCHOOL OF BUSINESS

Business Statistics (QMM 501)

1. What is the probability that the defective rate is greater than 4%?

( )
0.04−0.02
P ( ^p > 0.04 ) =p Z> =P ( Z> 4.04 )=0

√ 0.02 ( 0.98 )
800
2. Suppose that in a random sample of 800 components the defective rate is 4%. What does that
suggest about the defective rate on the assembly line?
The probability of selecting a sample with a sample proportion as extreme as 0.04 has been
computed in the previous question to be 0. Thus, it is impossible to select such a sample. We
conclude that the defective rate is not 2% but more.

Problem 7

In an effort to cut costs and improve profits, many U.S. companies have been turning to outsourcing. In
fact, according to Purchasing magazine, 54% of companies surveyed outsourced some part of their
manufacturing process in the past two to three years. Suppose 565 of these companies are contacted.

np=565 ( .54 )=305.1>5∧n ( 1− p ) =565 (.46 )=259.9>5

1. What is the probability that 339 or more companies outsourced some part of their
manufacturing process in the past two to three years?

( )
( )
339 0.6−0.54
P ( X >339 )=P ^p > = p ( ^p >0.6 ) =p Z> =P ( Z >2.86 )=1−P ( Z <2.86 )=1−.9979=.0021

√
565 0.54 ( 0.46 )
565
2. What is the probability that 288 or more companies outsourced some part of their
manufacturing process in the past two to three years?

( )
( )
288 0.51−0.54
P ( X >288 ) =P ^p > = p ( ^p >0.51 )= p Z > =P ( Z >−1.43 )=¿

√
565 0.54 ( 0.46 )
565
P( Z< 1.43)=.9236
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Business Statistics (QMM 501)

MCQs

1. An airplane is only allowed a gross passenger weight of 8000 kg. If the weights of passengers
traveling by air between Toronto and Vancouver have a mean of 78 kg and a standard deviation
of 7 kg, the approximate probability that the combined weight of 100 passengers will exceed
8,000 kg is:
(a) 0.4978
(b) 0.3987
(c) 0.1103
(d) 0.0044
(e) .0022
2. The Central Limit Theorem states that:
(a) if n is large then the distribution of the sample can be approximated closely by a
normal curve
(b) if n is large, and if the population is normal, then the variance of the sample mean
must be small.
(c) if n is large, then the sampling distribution of the sample mean can be approximated
closely by a normal curve
(d) if n is large, and if the population is normal, then the sampling distribution of the
sample mean can be approximated closely by a normal curve
(e) if n is large, then the variance of the sample must be small.
3. As the sample size gets larger, the standard error of the sampling distribution of the sample
mean gets larger as well.
(a) True.
(b) False.
4. The sampling distribution of refers to:
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Business Statistics (QMM 501)

(a) the distribution of the various sample sizes which might be used in a given study
(b) the distribution of the different possible values of the sample mean together with
their respective probabilities of occurrence
(c) the distribution of the values of the items in the population
(d) the distribution of the values of the items actually selected in a given sample
(e) none of the above
5. The daily revenue at a university snack bar has been recorded for the past five years. Records
indicate that the mean daily revenue is $1500 and the standard deviation is $500. The
distribution is skewed to the right due to several high volume days (football game days).
Suppose that 100 days are randomly selected and the average daily revenue computed. Which
of the following describes the sampling distribution of the sample mean?
(a) normally distributed with a mean of $1500 and a standard deviation of $500
(b) normally distributed with a mean of $1500 and a standard deviation of $50
(c) normally distributed with a mean of $150 and a standard deviation of $50
(d) skewed to the right with a mean of $1500 and a standard deviation of $500
6. The time required to assemble an electronic component is normally distributed with a mean of
12 minutes and a standard deviation of 1.5 min. Find the probability that the time required to
assemble all nine components (i.e. the total assembly time) is greater than 117 minutes.
(a) .2514
(b) .2486
(c) .4772
(d) .0228
(e) .0013
7. In a random sample of 1000 students, ^p= 0.80 (or 80%) were in favor of longer hours at the
school library. The standard error of ^p (the sample proportion) is
(a) 0.160

(b) 0.013

(c) 0.640
(d) 0.800
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Business Statistics (QMM 501)