Roll #________

Section _______
National University of Modern Languages
Department of Accounting & Finance
BSAF III -Morning – End Term Examination – Spring 2024
Paper: Statistical Infeence Total Marks :50
Course Code: AFMT 241 Time Allowed: 3 hours
Instructions:

 Attempt all questions

 Write down your roll# on the question paper.
 Attach your question paper with the answer sheet before leaving examination hall.
 Keep your roll # slip and university ID card with you during the examination.
 Use of calculator and statistical tables are allowed.

Q-1. a. A population consists of favorite subjects of 6 students as given below: Chemistry(C), Zoology(Z), Stats(S),
Maths(M), Stats(S), Botany(B). Determine the proportion of students whose favorite subject is Stats in the population. Take
all possible samples of three subjects without replacement from this population and find the proportion of students whose
favorite subject is Stats in each sample. Form the sampling distribution of the sample proportion ^p and verify that: μ ^p= p
pq N−n
and Var ( ^
p )= b. The marketing director of a large department store wants to estimate the average number of
n N−1
customers who enter the store every 5 minutes. She randomly selects 5-minute intervals and counts the number of arrivals
at the store. She obtains a sample of 100 arrivals with an average of 47 customers with a variance of 255 arrivals2. The
analyst assumes the number of arrivals is normally distributed. Using these data, the analyst computes a 99% confidence
interval to estimate the mean value for all 5-minute intervals. What interval values does she get. (LO# 3, 5, 6)
(8+5 marks)

Q-2. a. According to the Stern Marketing Group, 9 out of 10 professional women say that financial planning is more
important today than it was five years ago. Where do these women go for help in financial planning? Forty-seven percent
use a financial advisor (broker, tax consultant, financial planner). Twenty-eight percent use written sources such as
magazines, books, and newspapers. Suppose these figures were obtained by taking a sample of 560 professional women
who said that financial planning is more important today than it was five years ago. Construct a 95% confidence interval
for the proportion of professional women who use a financial advisor.
b. According to a CCH Unscheduled Absence survey, 9% of small businesses use telecommuting of
workers in an effort to reduce unscheduled absenteeism. This proportion compares to 6% for all businesses. Is there really
a significant difference between small businesses and all businesses on this issue? Use these data and an alpha of 0.10 to
test this question. Assume that there were 780 small businesses and 915 other businesses in this survey.
(LO# 1, 5, 6) (5+5 marks)

Q.3 a. A company’s auditor believes the per diem cost in Nashville, Tennessee, rose significantly between 2008 and 2019.
To test this belief, the auditor samples 51 business trips from the company’s records for 2008; the sample average was $212
per day, with a population standard deviation of $38.50. The auditor selects a second random sample of 47 business trips
from the company’s records for 2019; the sample average was $231 per day, with a population standard deviation of
$35.60. If he uses a risk of committing a Type I error of 0.01, does the auditor find that the per diem average expense in
Nashville has gone up significantly. The distributions of all business trips’ cost in 2008 and 2009 are normal.
b. Based on an indication that mean daily car rental rates may be lesser for Dallas than Boston.
Suppose a sample of nine car rental companies in Dallas results in a mean of $44 and a standard deviation of $3. Further a
sample of eight car rental companies in Boston is taken and the mean car rental rate is $47, with a standard deviation of $5.
Use α =0.05 to test whether the average daily car rental rates in Dallas are significantly lower than those in Boston.
Assume car rental rates are normally distributed and the population variances are not equal.
(LO# 1, 5, 7)(6+6 Marks)

Q4. A group of 30-year-olds is interviewed to determine whether the type of music most listened to by people in their age
category is independent of the geographic location of their residence. Use the chi-square test of independence, and the
following contingency table to determine whether music preference is independent of geographic location.
Type of music preferred
Geographic Rock R&B Country Classical
al Region
Northeast 140 32 5 18

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 south 134 41 52 8
west 154 27 8 13
(LO# 7)(8
Marks)
Q5. Suppose you are using a completely randomized design to study some phenomenon. There are three treatment levels
and a total of 17 people in the study. Complete the following ANOVA table. Use α =0.05 to find the table F value and use
the data to test the null hypothesis that all three treatments are equal
Source of Variation SS df MS F Cal .
Between Groups 29.64 −¿ - −¿
Within Groups 68.42 - −¿
Total −¿ −¿
(LO# 1, 7)(7 Marks)
=============================================
The value of Z for common level of confidence

F Table for α = 0.05

df1=1 2 3 5 12
df2=1 161.4476 199.5 215.7073 230.1619 243.906
2 18.5128 19 19.1643 19.2964 19.4125
3 10.128 9.5521 9.2766 9.0135 8.7446
6 5.9874 5.1433 4.7571 4.3874 3.9999
11 4.8443 3.9823 3.5874 3.2039 2.7876
13 4.6672 3.8056 3.4105 3.0254 2.6037
14 4.6001 3.7389 3.3439 2.9582 2.5342
15 4.5431 3.6823 3.2874 2.9013 2.4753
Critical Values of t-Distribution
Level of significance One Tailed Test 0.05 0.025 0.01 0.005 0.001
Degrees of freedom (df) Two Tailed Test 0.10 0.05 0.02 0.01 0.002
1 6.314 12.706 31.821 63.657 318.309
2 2.920 4.303 6.965 9.925 22.327
3 2.353 3.182 4.541 5.841 10.215
4 2.132 2.776 3.747 4.604 7.173
5 2.015 2.571 3.365 4.032 5.893
6 1.943 2.447 3.143 3.707 5.208
7 1.895 2.365 2.998 3.499 4.785
8 1.860 2.306 2.896 3.355 4.501
9 1.833 2.262 2.821 3.250 4.297
10 1.812 2.228 2.764 3.169 4.144
11 1.796 2.201 2.718 3.106 4.025
12 1.782 2.179 2.681 3.055 3.930
13 1.771 2.160 2.650 3.012 3.852
14 1.761 2.145 2.624 2.977 3.787
15 1.753 2.131 2.602 2.947 3.733
Critical Values of χ 2Distribution
Degrees of freedom (df) 0.05 0.025 0.01
1 3.841 5.024 6.635
2 5.991 7.378 9.210
3 7.815 9.348 11.345

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4 9.488 11.143 13.277
5 11.070 12.833 15.086
6 12.592 14.449 16.812
7 14.067 16.013 18.475
8 15.507 17.535 20.090

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