Statistics for Business and Economics
Review Questions
Course Introduction
This course introduces the fundamental concepts and techniques of statistics as applied to business and economics. Students will learn to collect, analyze, interpret, and present data effectively, utilizing statistical tools to support decision-making processes in real-world scenarios. Topics include descriptive statistics, probability distributions, sampling methods, hypothesis testing, regression analysis, and the use of statistical software. Emphasis is placed on practical application of statistical reasoning to solve business problems and inform economic strategies.
Recommended Textbook
Basic Business Statistics Global Edition 12th edition by Mark Berenson
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2
Chapter 1: Introduction
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Sample Questions
Q1) Compiling the number of registered voters who turned out to vote for the primary in Iowa is an example of descriptive statistics.
A)True
B)False
Answer: True
Q2) The Human Resources director of a large corporation wishes to develop an employee benefits package and decides to select 500 employees from a list of all (N = 40,000)workers in order to study their preferences for the various components of a potential package.All the employees in the corporation constitute the ________.
Answer: population
Q3) Whether the university is private or public is an example of a nominal scaled variable.
A)True
B)False
Answer: True
Q4) The Dean of Students conducted a survey on campus.Major area of study is an example of a ________ variable.
Answer: categorical
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Chapter 2: Organizing and Visualizing Data
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Sample Questions
Q1) A research analyst was directed to arrange raw data collected on the yield of wheat,ranging from 40 to 93 bushels per acre,in a frequency distribution.He should choose 30 as the class interval width.
A)True
B)False
Answer: False
Q2) Referring to Table 2-2,how many regional offices are represented in the survey results?
A)5
B)11
C)15
D)40
Answer: D
Q3) When comparing two or more large sets of numerical data,the distributions being developed should use the same ________.
Answer: class boundaries
Q4) Referring to Table 2-14,construct a table of total percentages. Answer: 11ea308a_b251_3d6d_a441_0ba36fac0ad8_TB1605_00
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Chapter 3: Numerical Descriptive Measures
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Sample Questions
Q1) Referring to Table 3-7,what is the five-number summary of the change in the cost?
Answer: $308,$593,$895.5,$1425,and $1720
Q2) The line drawn within the box of the boxplot always represents the arithmetic mean.
A)True
B)False
Answer: False
Q3) Referring to Table 3-5,what is the range of the rate of return?
Answer: 18.55%
Q4) Referring to Table 3-1,calculate the standard deviation of the ages of the senior citizens correct to the nearest hundredth of a year.
Answer: 9.74 years
Q5) In left-skewed distributions,the distance from the smallest value to Q is greater than the distance from Q to the largest value.
A)True
B)False
Answer: True
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Chapter 4: Basic Probability
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Q1) Referring to Table 4-7,the probability that you win any money is ________.
Q2) Referring to Table 4-8,if a randomly selected student lives in the dormitory,what is the probability that the student is not a freshman?
Q3) Referring to Table 4-6,if a randomly selected student has not passed the ELM,the probability the student is from southern Texas is ________.
Q4) You know that the probability of a randomly selected student will cheat on an exam is 1%.You also know that the probability of a randomly selected student will cheat on an exam knowing that his/her fellow classmate is cheating on the exam is also 1%.Which of the following is true about the event of "the randomly selected student cheating on an exam" and "his/her classmate is cheating on the exam"?
A)They are mutually exclusive.
B)They are collectively exhaustive.
C)They are independent.
D)None of the above.
Q5) A new model car from Ford Motor Company offers a keyless entry system that utilizes a four-letter code.How many different possible combinations are there for the code?
Q6) Referring to Table 4-9,set up a contingency table.
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Chapter 5: Discrete Probability Distributions
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Sample Questions
Q1) A lab orders 100 rats a week for each of the 52 weeks in the year for experiments that the lab conducts.Prices for 100 rats follow the following distribution: Price: $10.00 $12.50 $15.00
Probability: 0.35 0.40 0.25
How much should the lab budget for next year's rat orders be,assuming this distribution does not change?
A)$520
B)$637
C)$650
D)$780
Q2) Referring to Table 5-9,what is the probability that in the next 1,000 customers,the hotel chain will have less than two or more than eight mishandled bags?
Q3) The variance of the sum of two investments will be equal to the sum of the variances of the two investments plus twice the covariance between the investments.
A)True
B)False
Q4) Referring to Table 5-7,what is the standard deviation of the value gain for the house in neighborhood B?
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Chapter 6: The Normal Distribution and Other Continuous Distributions
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Sample Questions
Q1) Suppose students arrive at an advising office at a rate of 30 per hour.Which of the following distributions would you use to determine the probability that the next two students will arrive 30 minutes apart?
A)Normal distribution
B)Poisson distribution
C)Uniform distribution
D)Exponential distribution
Q2) Referring to Table 6-6,find the probability that the annual return of a random year will be more than 7.5%.
Q3) Referring to Table 6-2,the probability is 0.45 that John's income as a waiter is more than how much in a given month?
Q4) The owner of a fish market determined that the average weight for a catfish is 3.2 pounds.He also knew that the probability of a randomly selected catfish that would weigh more than 3.8 pounds is 20% and the probability that a randomly selected catfish that would weigh less than 2.8 pounds is 30%.The probability that a randomly selected catfish will weigh between 2.6 and 3.6 pounds is ________.
Q5) Referring to Table 6-2,the probability is 0.9 that John's income as a waiter is less than how much in a given month?
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Chapter 7: Sampling and Sampling Distributions
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Sample Questions
Q1) The owner of a fish market has an assistant who has determined that the weights of catfish are normally distributed,with mean of 3.2 pounds and standard deviation of 0.8 pound.If a sample of 25 fish yields a mean of 3.6 pounds,what is the Z-score for this observation?
A)18.750
B)2.500
C)1.875
D)0.750
Q2) For distributions such as the normal distribution,the arithmetic mean is considered more stable from sample to sample than other measures of central tendency.
A)True
B)False
Q3) Which of the following is true about the sampling distribution of the sample mean?
A)The mean of the sampling distribution is always .
B)The standard deviation of the sampling distribution is always .
C)The shape of the sampling distribution is always approximately normal.
D)All of the above are true.
Q4) Coverage error results in a ________.
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Chapter 8: Confidence Interval Estimation
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Sample Questions
Q1) A university system enrolling hundreds of thousands of students is considering a change in the way students pay for their education.Currently,the students pay $400 per credit hour.The university system administrators are contemplating charging each student a set fee of $7,000 per quarter,regardless of how many credit hours each takes.To see if this proposal would be economically feasible,the administrators would like to know how many credit hours,on the average,each student takes per quarter.A random sample of 250 students yields a mean of 14.1 credit hours per quarter and a standard deviation of 2.3 credit hours per quarter.Suppose the administration wanted to estimate the mean to within 0.1 hours at 95% reliability and assumed that the sample standard deviation provided a good estimate for the population standard deviation.How large a total sample would they need to take?
Q2) Which of the following is not true about the Student's t distribution?
A)It has more area in the tails and less in the center than does the normal distribution.
B)It is used to construct confidence intervals for the population mean when the population standard deviation is known.
C)It is bell shaped and symmetrical.
D)As the number of degrees of freedom increases,the t distribution approaches the normal distribution.
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Chapter 9: Fundamentals of Hypothesis Testing:
One-Sample Tests
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Sample Questions
Q1) Referring to Table 9-4,if the level of significance had been chosen as 0.05,the null hypothesis would be rejected.
A)True
B)False
Q2) If,as a result of a hypothesis test,you reject the null hypothesis when it is ESQ,then you have committed
A)a Type II error.
B)a Type I error.
C)no error.
D)an acceptance error.
Q3) Referring to Table 9-9,the lowest level of significance at which the null hypothesis can still be rejected is ________.
Q4) Referring to Table 9-2,what is the power of the test?
Q5) Referring to Table 9-8,the lowest level of significance at which the null hypothesis can be rejected is ________.
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Chapter 10: Two-Sample Tests
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Sample Questions
Q1) Referring to Table 10-2,the researcher was attempting to show statistically that the female MBA graduates have a significantly lower mean starting salary than the male MBA graduates.From the analysis in Table 10-2,the correct test statistic is A)-6610.
B)-1.3763.
C)-1.7011. D)0.0898.
Q2) Referring to Table 10-6,the p-value for a two-tail is ________.
Q3) Referring to Table 10-12,the null hypothesis will be rejected if the test statistic is ________.
Q4) Referring to Table 10-4,the critical values for a two-tail test of the null hypothesis of no difference in the population means at the = 0.05 level of significance are ________.
Q5) The F distribution is symmetric.
A)True
B)False
Q6) Referring to Table 10-15,what is the value of the test statistic for testing whether there is evidence of a difference in the variances?
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Chapter 11: Analysis of Variance
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Q1) Referring to Table 11-8,the null hypothesis for the F test for the block effects should be rejected at a 0.05 level of significance.
A)True
B)False
Q2) Referring to Table 11-3,what are the numerator and denominator degrees of freedom for Levene's test for homogeneity of variances respectively?
Q3) Referring to Table 11-8,the randomized block F test is valid only if the population of the amount of time needed is normally distributed for the 3 brands.
A)True
B)False
Q4) Referring to Table 11-7,what is the null hypothesis for testing the block effects?
A)H : A = B = C= D
B)H : K l = S h = L gh = Is c
C)H : MA = MB = MC = MD
D)H : MK l = MS h = ML gh = MIs c
Q5) Referring to Table 11-8,what is the value of the F test statistic for testing the block effects?
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Chapter 12: Chi-Square Tests and Nonparametric Tests
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Sample Questions
Q1) Referring to Table 12-5,the null hypothesis will be rejected.
A)True
B)False
Q2) Referring to Table 12-13,suppose the value of the test statistic was 30.00 (which is not the correct value)and the critical value at 1% level of significance was 10.00 (which is not the correct value),which of the following conclusions would be correct?
A)We will not reject the null and conclude that mean number of hours spent watching TV and weights are independent.
B)We will reject the null and conclude that mean number of hours spent watching TV and weights are independent.
C)We will not reject the null and conclude that mean number of hours spent watching TV and weights are not independent.
D)We will reject the null and conclude that mean number of hours spent watching TV and weights are not independent.
Q3) Referring to Table 12-2,the p-value of the test is ________.
Q4) Referring to Table 12-5,the expected cell frequency for the Procedure D/Return cell is ________.
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Chapter 13: Simple Linear Regression
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Q1) Referring to Table 13-3,the director of cooperative education wanted to test the hypothesis that the population slope was equal to 0.The value of the test statistic is
Q2) Referring to Table 13-4,the least squares estimate of the slope is ________.
Q3) Referring to Table 13-5,the standard error of the estimate is ________.
Q4) In performing a regression analysis involving two numerical variables,you are assuming
A)the variances of X and Y are equal.
B)the variation around the line of regression is the same for each X value. C)that X and Y are independent.
D)All of the above.
Q5) Referring to Table 13-9,the value of the measured t test statistic to test whether mean SALARY depends linearly on HOURS is A)-4.7134. B)-1.8940. C)0.9795. D)13.3561.
Q6) Referring to Table 13-12,predict the amount of time it would take to process 150 invoices.
Q7) Referring to Table 13-3,the least squares estimate of the slope is ________.
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Chapter 14: Introduction to Multiple Regression
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Q1) Referring to 14-16,the 0 to 60 miles per hour acceleration time of a coupe is predicted to be 0.7679 seconds lower than that of an SUV.
A)True B)False
Q2) From the coefficient of multiple determination,you cannot detect the strength of the relationship between Y and any individual independent variable.
A)True B)False
Q3) In trying to construct a model to estimate grades on a statistics test,a professor wanted to include,among other factors,whether the person had taken the course previously.To do this,the professor included a dummy variable in her regression model that was equal to 1 if the person had previously taken the course,and 0 otherwise.The interpretation of the coefficient associated with this dummy variable would be the mean amount the repeat students tended to be above or below non-repeaters,with all other factors the same.
A)True B)False
Q4) Referring to Table 14-10,the standard error of the estimate is ________.
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Chapter 15: Multiple Regression Model Building
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Q1) Referring to Table 15-5,what is the value of the variance inflationary factor of Cargo Vol?
Q2) A regression diagnostic tool used to study the possible effects of collinearity is
A)the slope.
B)the Y-intercept.
C)the VIF.
D)the standard error of the estimate.
Q3) A microeconomist wants to determine how corporate sales are influenced by capital and wage spending by companies.She proceeds to randomly select 26 large corporations and record information in millions of dollars.A statistical analyst discovers that capital spending by corporations has a significant inverse relationship with wage spending.What should the microeconomist who developed this multiple regression model be particularly concerned with?
A)Randomness of error terms
B)Collinearity
C)Normality of residuals
D)Missing observations
Q4) Referring to Table 15-6,what is the value of the variance inflationary factor of Age?
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Chapter 16: Time-Series Forecasting
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Q1) Which of the following terms describes the up and down movements of a time series that vary both in length and intensity?
A)Trend
B)Cyclical component
C)Irregular component
D)Seasonal component
Q2) Referring to Table 16-1,set up a scatter diagram (i.e.,a time-series plot)with year on the horizontal X-axis.
Q3) Each forecast using the method of exponential smoothing depends on all the previous observations in the time series.
A)True
B)False
Q4) To assess the adequacy of a forecasting model,one measure that is often used is A)quadratic trend analysis.
B)the MAD.
C)exponential smoothing.
D)moving averages.
Q5) Referring to Table 16-13,what is your forecast for the 13 month using the linear-trend model?
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Chapter 17: Statistical Applications in Quality Management
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Sample Questions
Q1) A process capability is estimated by the percentage of product or service that fall outside the specification limits.
A)True
B)False
Q2) Determining the root causes of why defects can occur along with the variables in the process that cause these defects to occur involves which part of the DMAIC process?
A)Define
B)Measure
C)Analyze
D)Improve
E)Control
Q3) Referring to Table 17-9,an R chart is to be constructed for the weight.The upper control limit for this data set is ________.
Q4) Referring to Table 17-7,what percentage of the chips will fall below the upper specification limit?
Q5) Referring to Table 17-5,construct a p control chart for these data.
Q6) Referring to Table 17-4,what is the value of the CPU index?
Q7) Referring to Table 17-9,construct an R chart for the time required to register.
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Chapter 18: A Roadmap for Analyzing Data
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Sample Questions
Q1) To test the effectiveness of a business school preparation course,8 students took a general business test before and after the course.Suppose the before and after exam scores are both normally distributed.Which of the following tests will be the most appropriate?
A)Pooled-variance t test
B)Paired t test
C)Wilcoxon rank sum test
D)McNemar test
Q2) A major Blu-ray rental chain is considering opening a new store in an area that currently does not have any such stores.The chain will open if there is evidence that more than 5,000 of the 20,000 households in the area are equipped with Blu-ray players.It conducts a telephone poll of 300 randomly selected households in the area and finds that 96 have Blu-ray players.Which of the following tests will be the most appropriate?
A)t test for the mean
B)Z test for the proportion
C)Pooled-variance t test
D)Separate-variance t test
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Chapter 19: Questions that Involve Online Topics
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Sample Questions
Q1) Which of the following is an assumption required by the Analysis of Means (ANOM)?
A)The variance of the groups is different.
B)The observations from each of the groups are assumed to be approximately normally distributed.
C)The shape of the distribution of the observations from the groups is different.
D)The number of observations in each group has to be at least 30.
Q2) Referring to Table 8-2,if the investor wants a 95% confidence on estimating the true population mean market price of the houses in the suburban county to be within $10,000,how large a sample will he need?
Q3) Referring to Table 19-6,what is the expected profit under certainty?
Q4) Referring to Table 9-1,if you select a sample of 100 light bulbs and are willing to have a level of significance of 0.10,the probability of a Type II error is ________ if the population mean bulb life is 490 hours.
Q5) Referring to Table 19-5,what is the optimal action using EMV?
Q6) Referring to Table 16-2,what is the unweighted aggregate price index for the basket of four food items in 2008 using 2006 as the base year?
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