Applied Statistics in Business Final Exam
Course Introduction
Applied Statistics in Business introduces students to the fundamental concepts and practical applications of statistical methods in solving business problems. The course covers topics such as data collection and analysis, probability distributions, hypothesis testing, regression analysis, and forecasting, with a strong emphasis on real-world business scenarios. Students will learn to interpret and communicate statistical findings, use statistical software, and make data-driven decisions to support business strategy and operations. By the end of the course, students will be equipped with the analytical tools necessary to effectively address uncertainty and optimize outcomes in various business contexts.
Recommended Textbook
Modern Business Statistics with Microsoft Excel 5th Edition by David R. Anderson
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Chapter 1: Data and Statistics
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Sample Questions
Q1) Temperature is an example of
A)a categorical variable
B)a quantitative variable
C)either a quantitative or categorical variable
D)neither a quantitative nor categorical variable
Answer: B
Q2) Flight time from Cincinnati to Atlanta is an example of a _______ variable and _______ measurement.
A)discrete, interval
B)discrete, ratio
C)continuous, interval
D)continuous, ratio
Answer: D
Q3) Facts and figures that are collected, analyzed and summarized for presentation and interpretation are
A)data
B)variables
C)elements
D)Both variables and elements are correct.
Answer: A
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Chapter 2: Descriptive Statistics: Tabular and Graphical Displays
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Sample Questions
Q1) Which of the following is least useful in studying the relationship between two variables?
A)trendline
B)stem-and-leaf display
C)crosstabulation
D)scatter diagram
Answer: B
Q2) The proper way to construct a stem-and-leaf display for the data set {62, 67, 68, 73, 73, 79, 91, 94, 95, 97} is to
A)exclude a stem labeled '8'
B)include a stem labeled '8' and enter no leaves on the stem
C)include a stem labeled '(8)' and enter no leaves on the stem
D)include a stem labeled '8' and enter one leaf value of '0' on the stem
Answer: B
Q3) Refer to Exhibit 2-1. The cumulative relative frequency for the class of 20 - 29
A)is 300
B)is 0.25
C)is 0.75
D)is 0.5
Answer: C
Page 4
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Chapter 3: Descriptive Statistics: Numerical Measures
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Sample Questions
Q1) The coefficient of determination is equal to the
A)absolute value of the correlation coefficient
B)squared value of the correlation coefficient
C)square-root of the correlation coefficient
D)inverse value of the correlation coefficient
Answer: B
Q2) Refer to Exhibit 3-1. The 75th percentile is
A)6
B)7
C)8
D)9
Answer: D
Q3) 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)a positive relation between the x and the y variables
Answer: D
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Chapter 4: Introduction to Probability
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Sample Questions
Q1) If A and B are mutually exclusive events with P(A) = 0.3 and P(B) = 0.5, then P(A \(\cap\) B) =
A)0.30
B)0.15
C)0.00
D)0.20
Q2) If A and B are independent events with P(A) = .1 and P(B) = .4, then
A)P(A \(\cap\) B) = 0
B)P(A \(\cap\) B) = .04
C)P(A \(\cup\) B) = .5
D)P(A \(\cap\) B) = .25
Q3) Initial estimates of the probabilities of events are known as A)sets
B)posterior probabilities
C)conditional probabilities
D)prior probabilities
Q4) It is estimated that 3% of the athletes competing in a large tournament are users of an illegal drug to enhance performance. The test for this drug is 90% accurate. What is the probability that an athlete who tests positive is actually a user?
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Chapter 5: Discrete Probability Distributions
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Sample Questions
Q1) The key difference between the binomial and hypergeometric distribution is that with the hypergeometric distribution the
A)probability of success must be less than 0.5
B)probability of success changes from trial to trial
C)trials are independent of each other D)random variable is continuous
Q2) In a southern state, it was revealed that 5% of all automobiles in the state did not pass inspection. Of the next ten automobiles entering the inspection station,
a. what is the probability that none will pass inspection?
b. what is the probability that all will pass inspection?
c. what is the probability that exactly two will not pass inspection?
d. what is the probability that more than three will not pass inspection?
e. what is the probability that fewer than two will not pass inspection?
f. Find the expected number of automobiles not passing inspection.
g. Determine the standard deviation for the number of cars not passing inspection.
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Chapter 6: Continuous Probability Distributions
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Sample Questions
Q1) Refer to Exhibit 6-6. What percentage of tires will have a life of 34,000 to 46,000 miles?
A)38.49%
B)76.98%
C)50%
D)None of the alternative answers is correct.
Q2) Refer to Exhibit 6-4. What is the probability that a randomly selected individual with an MBA degree will get a starting salary of at least $30,000?
A)0.4772
B)0.9772
C)0.0228
D)0.5000
Q3) X is a normally distributed random variable with a mean of 50 and a standard deviation of 5. Use Excel to calculate the following:
a.P(x \(\le\) 45)
b.P(45 \(\le\) x \(\le\) 55)
c.P(x \(\ge\) 55)
d.x value with .20 in the lower tail
e.x value with .01 in the upper tail
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Chapter 7: Sampling and Sampling Distributions
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Sample Questions
Q1) Refer to Exhibit 7-3. The point estimate of the mean of the population is
A)18.0
B)19.6
C)108
D)sixteen, since 16 is the smallest value in the sample
Q2) A simple random sample of 28 observations was taken from a large population. The sample mean equaled 50. Fifty is a
A)population parameter
B)point estimator
C)sample parameter
D)point estimate
Q3) The standard deviation of a point estimator is the
A)standard error
B)sample statistic
C)point estimate
D)sampling error
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Chapter 8: Interval Estimation
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Sample Questions
Q1) The t distribution should be used whenever
A)the sample size is less than 30
B)the sample standard deviation is used to estimate the population standard deviation
C)the population is not normally distributed
D)None of the other answers are correct.
Q2) In general, higher confidence levels provide
A)wider confidence intervals
B)narrower confidence intervals
C)a smaller standard error
D)unbiased estimates
Q3) The mean of the t distribution is A)0
B).5
C)1
D)problem specific
Q4) A sample of 16 students from a large university is taken. The average age in the sample was 22 years with a standard deviation of 6 years. Construct a 95% confidence interval for the average age of the population. Assume the population of student ages is normally distributed.
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Chapter 9: Hypothesis Tests
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Sample Questions
Q1) In tests about a population proportion, p<sub>0</sub> represents the
A)hypothesized population proportion
B)observed sample proportion
C)observed p-value
D)probability of
Q2) Excel's __________ function can be used to calculate a p-value for a hypothesis test when \(\sigma\) is unknown.
A)RAND
B)T.DIST
C)NORM.S.DIST
D)Not enough information is given to answer this question.
Q3) A Type I error is committed when
A)a true alternative hypothesis is not accepted
B)a true null hypothesis is rejected
C)the critical value is greater than the value of the test statistic
D)sample data contradict the null hypothesis
Q4) In a television commercial, the manufacturer of a toothpaste claims that at least 4 out of 5 dentists recommend its product. A consumer-protection group wants to test that claim. Identify the hypotheses.
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Chapter 10: Inference About Means and Proportions With
Two Populations
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Sample Questions
Q1) Refer to Exhibit 10-1. At 95% confidence, the margin of error is A)1.96
B)1.645
C)3.920
D)2.000
Q2) Refer to Exhibit 10-9. At 90% confidence the null hypothesis
A)should not be rejected
B)should be rejected
C)should be revised
D)None of these alternatives is correct.
Q3) Refer to Exhibit 10-9. The test statistic is A)1.645
B)1.96
C)2.096
D)2.256
Q4) Refer to Exhibit 10-13. The test statistic has a value of A)1.96
B)1.645
C)0.8
D)2.7
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Chapter 11: Inferences About Population Variances
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Sample Questions
Q1) The 90% confidence interval estimate for a population standard deviation when a sample variance of 50 is obtained from a sample of 15 items is
A)4.18 to 15.07
B)5.18 to 11.15
C)5.44 to 10.32
D)29.55 to 106.53
Q2) A random sample of 41 scores of students taking the ACT test showed a standard deviation of 8 points. Provide a 98% confidence interval estimate for the standard deviation of all the ACT test scores.
Q3) Refer to Exhibit 11-3. The null hypothesis
A)should be rejected
B)should not be rejected
C)should be revised
D)None of these alternatives is correct.
Q4) Refer to Exhibit 11-8. The null hypothesis
A)should be rejected
B)should not be rejected
C)should be revised
D)None of these alternatives is correct.
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Chapter 12: Tests of Goodness of Fit, Independence and Multiple Proportions
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Sample Questions
Q1) The degrees of freedom for a contingency table with 12 rows and 12 columns is A)144
B)121
C)12
D)120
Q2) The number of categories of outcomes per trial for a multinomial probability distribution is
A)two or more
B)three or more
C)four or more
D)five or more
Q3) Refer to Exhibit 12-4. The expected frequency for the Business College is A)0.3
B)0.35
C)90
D)105
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Chapter 13: Experimental Design and Analysis of Variance
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Sample Questions
Q1) Refer to Exhibit 13-7. If at a 5% level of significance, we want to determine whether or not the means of the populations are equal, the critical value of F is
A)4.75
B)19.41
C)3.16
D)1.96
Q2) An experimental design where the experimental units are randomly assigned to the treatments is known as
A)factor block design
B)random factor design
C)completely randomized design
D)None of these alternatives is correct.
Q3) Refer to Exhibit 13-4. The number of degrees of freedom corresponding to between treatments is
A)60
B)59
C)5
D)4
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Chapter 14: Simple Linear Regression
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Sample Questions
Q1) The proportion of the variation in the dependent variable y that is explained by the estimated regression equation is measured by the
A)correlation coefficient
B)standard error of the estimate
C)coefficient of determination
D)confidence interval estimate
Q2) Refer to Exhibit 14-2. The sample correlation coefficient equals
A)-86.667
B)-0.99705
C)0.9941
D)0.99705
Q3) If the coefficient of correlation is 0.4, the percentage of variation in the dependent variable explained by the estimated regression equation
A)is 40%
B)is 16%
C)is 4%
D)can be any positive value
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Chapter 15: Multiple Regression
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Sample Questions
Q1) A regression model involved 5 independent variables and 126 observations. The critical value of t for testing the significance of each of the independent variable's coefficients will have
A)131 degrees of freedom
B)125 degrees of freedom
C)130 degrees of freedom
D)4 degrees of freedom
Q2) Refer to Exhibit 15-5. The interpretation of the coefficient on x<sub>1</sub> is that
A)a one unit change in x<sub>1</sub> will lead to a 25.625 unit change in y
B)a one unit change in x<sub>1</sub> will lead to a 25.625 unit increase in y when all other variables are held constant
C)a one unit change in x<sub>1</sub> will lead to a 25.625 unit increase in x<sub>2</sub> when all other variables are held constant
D)It is impossible to interpret the coefficient.
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Chapter 16: Regression Analysis: Model Building
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Sample Questions
Q1) Forty-eight observations of a dependent variable (y) and five independent variables resulted in an SSE of 438. When two additional independent variables were added to the model, the SSE was reduced to 375. At a 5% level of significance, determine if the two additional independent variables contribute significantly to the model.
Q2) Refer to Exhibit 16-2. The value of MSE is
A)348
B)10.40
C)10.83
D)32.13
Q3) The correlation in error terms that arises when the error terms at successive points in time are related is termed
A)leverage
B)multicorrelation
C)autocorrelation
D)parallel correlation
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Chapter 17: Time Series Analysis and Forecasting
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Sample Questions
Q1) Refer to Exhibit 17-2. The slope of linear trend equation, b<sub>1</sub>, is
A)2.5
B)2.0
C)1.0
D)1.25
Q2) In the linear trend equation, T<sub>t</sub> = b<sub>0</sub> + b<sub>1</sub>t b<sub>1</sub> represents the A)trend value in period t
B)intercept of the trend line
C)slope of the trend line
D)point in time
Q3) The term exponential smoothing comes from A)its emphasis on minimizing mean squared error
B)the exponential nature of the weighting scheme used C)its use in fitting exponential trend lines
D)the nonlinear noise it attempts to remove
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Chapter 18: Nonparametric Methods
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Sample Questions
Q1) Refer to Exhibit 18-1. The null hypothesis that is being tested is
A)H<sub>0</sub>: \(\mu\) = 5
B)H<sub>0</sub>: \(\mu\) = 0.5
C)H<sub>0</sub>: p = 5
D)H<sub>0</sub>: p = 0.5
Q2) Refer to Exhibit 18-4. The null hypothesis is to be tested at the 5% level. The decision rule is not to reject the null hypothesis if
A)-1.96 < z < 1.96
B)-1.645 < z < 1.645
C)z > 1.96 or z < -1.96
D)the number of "+" signs is greater than or equal to 2 but less than or equal to eight
Q3) For the Wilcoxon signed-rank test, ties among absolute differences are assigned the A)lowest of their ranks
B)average of their ranks
C)highest of their ranks
D)sum of their ranks
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Chapter 19: Statistical Methods for Quality Control
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Sample Questions
Q1) Which of the following is a statistical method used in quality control?
A)statistical process control
B)acceptance sampling
C)Both statistical process control and acceptance sampling are correct.
D)None of the other answers is correct.
Q2) The control limits for a p chart are how many standard deviations above and below the proportion defective?
A)one
B)two
C)three
D)four
Q3) The control limits for an np chart are how many standard deviations above and below the expected number of defectives?
A)one
B)two
C)three
D)four
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Chapter 20: Decision Analysis
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Sample Questions
Q1) The approach to determine the optimal decision strategy involves
A)a forward (left to right) pass through the decision tree
B)a backward (right to left) pass through the decision tree
C)choosing the outcome of a chance event with the greatest probability
D)choosing the outcome of a chance event with the greatest payoff
Q2) A posterior probability associated with sample information is of the form
A)P(a state of nature | a sample outcome)
B)P(a sample outcome | a state of nature)
C)P(a decision alternative | a sample outcome)
D)P(a sample outcome | a decision alternative)
Q3) The probability of both sample information and a particular state of nature occurring simultaneously is
A)joint probability
B)unconditional probability
C)marginal probability
D)conditional probability
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Chapter 21: Sample Survey
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Sample Questions
Q1) Refer to Exhibit 21-1. An estimate of the standard error of the mean (for the total) is
A)62,500.50
B)47,958.32
C)7.8125
D)50,000.00
Q2) Refer to Exhibit 21-4. The estimate of the standard error of proportion is
A)0.210
B)0.700
C)0.300
D)0.062
Q3) Refer to Exhibit 21-2. An approximate 95% confidence interval for the population total is
A)482 to 517
B)385,759 to 414,241
C)400,000 to 500,000
D)350,000 to 450,000
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