Statistics for Economics Test Preparation
Course Introduction
Statistics for Economics explores the fundamental statistical methods and concepts essential for analyzing economic data and making informed decisions. The course covers topics such as descriptive statistics, probability distributions, sampling techniques, estimation, hypothesis testing, regression analysis, and index numbers, all within the context of economic applications. Students will learn how to collect, interpret, and present economic data using appropriate statistical tools, enabling them to critically assess economic relationships, trends, and policy impacts. Emphasis is placed on both theoretical understanding and practical skills, with opportunities to work with real-world datasets and statistical software.
Recommended Textbook
Statistics for Business and Economics 8th Edition by Betty Newbold
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3406 Verified Questions
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Chapter 1: Describing Data: Graphical
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Sample Questions
Q1) The relative frequency in a class is obtained by dividing the frequency in that class by the total number of observations.
A)True
B)False
Answer: True
Q2) In this restaurant services study,the process of using this information to predict future needs of customers in the restaurant is called:
A)statistical survey.
B)systemic sampling.
C)descriptive statistics.
D)forecasting.
Answer: D
Q3) What is the statistic?
Answer: The computed 14.6 miles
Q4) An ogive is also called a cumulative line graph.
A)True
B)False
Answer: True
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Chapter 2: Describing Data: Numerical
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Sample Questions
Q1) What would be a reasonable estimate for the 75<sup>th</sup> percentile?
A)Between 23.2 and 26.3
B)Between 26.3 and 29.4
C)Between 29.4 and 32.5
D)Greater than 32.5
Answer: B
Q2) Determine if there exists a relationship between ice cream sales and temperature.
Answer: A useful rule of thumb is that a relationship exists if 11ea5b8a_b6c2_9014_b1f3_b908df20a44b_TB2968_11
2/ 11ea5b8a_b6c2_9015_b1f3_531aeb59a4f4_TB2968_11
.Since 2/ 11ea5b8a_b6c2_b726_b1f3_7df420857837_TB2968_11 = 2/ 11ea5b8a_b6c2_b727_b1f3_91b4809ed1ef_TB2968_11 = 0.535,and 11ea5b8a_b6c2_b728_b1f3_c3bb47fea52f_TB2968_11 = 0.679,we may conclude that a positive linear relationship exists between ice cream sales and temperature.
Q3) Approximately what proportion of the observations is between 195 and 315?
Answer: k = 3;hence at least 88.89% of the observations are in the interval between 195 and 315.
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Chapter 3: Probability
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Sample Questions
Q1) Let event A be that there are more than three defects and let event B be that there are four or fewer defects.Which of the following statements is true?
A)P(A B)= 0.18
B)P(A B)=0.07
C)Events A and B are collectively exhaustive.
D)Events A and B are mutually exclusive.
Answer: C
Q2) A junior executive looking at his business attire in his closet notes that he has five suits,six shirts,and three pairs of shoes.He is going on a business trip and needs to take two of each.How many different combinations of outfits could he take?
A)680
B)320
C)450
D)224
Answer: C
Q3) What is the probability that all four computers are occupied?
Answer: P(All computers are occupied)= (0.6)<sup>4</sup> = 0.1296
Q4) Calculate the marginal probabilities of events A<sub>i</sub>.
Answer: P(A<sub>1</sub>)= 0.25,P(A<sub>2</sub>)= 0.40,P(A<sub>3</sub>)= 0.35
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Chapter 4: Discrete Random Variables and Probability
Distributions
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Sample Questions
Q1) What is the standard deviation of the number of free throws that he will make?
A)1.131
B)1.280
C)2.608
D)2.828
Q2) The number of males selected from a sample of 5 students taken without replacement from a class of 9 females and 18 males has a hypergeometric distribution.
A)True
B)False
Q3) In a tennis match,a player must win three of five sets to win the match.If a player wins the first two sets,what is the probability that the player will win the match,assuming that each player is equally likely to win each set?
A)0.25
B)0.50
C)0.125
D)0.875
Q4) Three yellow and two blue pencils are in a drawer.If we randomly select two pencils from the drawer,find the probability distribution of X,the number of yellow pencils selected. To view all questions and flashcards with answers, click on the resource
Chapter 5: Continuous Random Variables and Probability
Distributions
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Sample Questions
Q1) The median score for the final exam in a chemistry class was 75 and 18% of the students received a grade greater than 80.If the test scores were normally distributed,what is the probability that a randomly selected exam had a score between 75 and 80?
A)68%
B)32%
C)80%
D)50%
Q2) You are in charge of arranging the catering for a company meeting.Your company is responsible for paying for all meals ordered,so you don't want to order too many.Suppose that the expected number of people for the meeting is 84,with a standard deviation of 4 people.What is the fewest number of meals should you order so that the probability of having more people than meals is 5%?
Q3) In a recent survey of high school students,it was found that the average amount of money spent on entertainment each week was normally distributed with a mean of $52.30.Suppose you are told that there is an 80% probability that a randomly-selected student spends somewhere between $49.74 and $54.86.What is the standard deviation of the amount of money spent by high school students monthly?
Q4) With probability 0.09 the number of successes is less than how many?
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Chapter 6: Sampling and Sampling Distributions
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Sample Questions
Q1) The central limit theorem states that if all possible random samples of size n are taken from any population,the sampling distribution of sample means becomes approximately normal when the sample size n is large enough.
A)True
B)False
Q2) What is the probability that the sample mean score is more than 230?
Q3) In a recent survey of college professors,it was found that the average amount of money spent on entertainment each week was normally distributed with a mean of $95.25 and a standard deviation of $27.32.What is the probability that the average spending of a sample of 25 randomly-selected professors will exceed $102.50?
A)0.0918
B)0.1064
C)0.3936
D)0.4082
Q4) The number of students using the ATM on campus daily is normally distributed with a mean of 237.6 and a standard deviation of 26.3.You take a random sample of 30 days.Find two values"a" and"b" that are symmetric around the mean such that the probability is 0.95 that the sample mean is greater than"a" and less than"b".
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Chapter 7: Estimation: Single Population
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Sample Questions
Q1) If a sample of size 41 is selected,the value of A for the probability P(-A t A)= 0.90 is:
A)1.303
B)1.684
C)2.021
D)2.423
Q2) Find the upper confidence limit of the 99% confidence interval.
A)340.25
B)325.98
C)319.59
D)332.41
Q3) The dollar value of orders placed through a particular store catalog is found to be normally distributed with a standard deviation of $21.58.A sample of 30 orders averaged $81.25.What is the 90% confidence interval around this sample mean?
A)$81.25 ± $21.58
B)$81.25 ± $10.79
C)$81.25 ± $12.15
D)$81.25 ± $6.48
Q4) Find a point estimate of the population mean that is unbiased and efficient.
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Chapter 8: Estimation: Additional Topics
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Sample Questions
Q1) Find a 90% confidence interval for the difference in average functioning time before recharging the two models.
Q2) What is the upper confidence limit of the 95% confidence interval?
A)29.505
B)30.172
C)10.006
D)22.797
Q3) What is the sample variance of the parking fines issued in Austin?
A)404.49
B)230.69
C)364.04
D)201.86
Q4) What is the upper confidence limit of the 95% confidence interval?
A)16.879
B)12.987
C)15.233
D)14.767
Q5) Find a 95% confidence interval for the difference in average functioning time before recharging the two models.
10
Q6) Calculate the width of the interval for a 95% confidence interval.
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Chapter 9: Hypothesis Testing: Single Population
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Sample Questions
Q1) When testing whether a population proportion is zero,a t test can be used only if the sample size is large.
A)True
B)False
Q2) List out the features of a power function in hypothesis testing.
Q3) What kind of alternative hypothesis type would fit such a survey?
Q4) How is hypothesis testing a counterfactual argument?
Q5) Increasing the significance level of a test increases the probability of a Type II error. A)True
B)False
Q6) The concentration of a drying compound is critical in gauging the final strength of an adhesive product.The standard deviation of the amount of the compound must be 1,500 parts-per-million (ppm)or less.Based on a sample of 25 mixtures,the standard deviation is 1,700 ppm.Is there reason to believe,at the 10 per cent significance level,that the standard deviation of the drying compound is more than 1,500 ppm? (Note: 1,500 ppm equals a proportion of .0015 and a percent of .000015. )
Q7) Calculate the sample mean and sample standard deviation.
Q8) What are the appropriate null and alternative hypotheses?
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Chapter 10: Hypothesis Testing: Additional Topics
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Sample Questions
Q1) What conclusion can be made about the effectiveness of the diet,based on the test,at the 0.05 level of significance?
A)The diet is not effective.
B)The diet is effective.
C)The sample size is relatively small to make a conclusion.
D)A conclusion cannot be drawn without calculating the p-value.
Q2) In testing H<sub>0</sub> : P<sub>x</sub> - P<sub>y</sub> = 0,the p-value equals the probability,1 - ,of avoiding the Type II error of erroneously failing to reject a null hypothesis that is in fact false.
A)True
B)False
Q3) The most accurate statement that can be made about the p-value for testing whether there is a difference in the population variances for preservatives A and B is:
A)p-value > 0.05
B)p-value = 0.00
C)p-value < 0.01
D)0.01 < p-value < 0.05
Q4) Use Excel or Minitab to summarize this data using descriptive statistics.
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Chapter 11: Simple Regression
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Sample Questions
Q1) Test H<sub>0</sub> : <sub>1</sub> = 0 vs.H<sub>1</sub> : <sub>1</sub> 0 using the t-test.
Q2) What is the value of "C"?
A)172.25
B)162.42
C)140.03
D)182.99
Q3) Perform a regression analysis on the data.
Q4) For the given data,what is/are the critical value(s)for testing the hypotheses at 0.05 level of significance?
A)+1.943
B)± 2.447
C)+1.645
D)-1.645
Q5) For the given data,what is the relationship between the Student's t-statistic and the F statistic?
Q6) What does the least-squares criterion have to do with obtaining a regression line for a given set of data?
Q7) Determine the sample regression line.
Page 13
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Chapter 12: Multiple Regression
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Sample Questions
Q1) The standard error of the estimate for a multiple regression model with two explanatory variables X<sub>1</sub> and X<sub>2</sub>:
A)measures the variation around the predicted regression equation.
B)measures the proportion of variation in Y that is explained by X<sub>1</sub> and X<sub>2</sub><sub>.</sub>
C)measures the proportion of variation in Y that is explained by X<sub>1</sub> holding X<sub>2</sub> constant.
D)has the same sign as b<sub>1</sub>.
Q2) If we reject the conditional hypothesis that the regression coefficient is zero,then we must conclude that the corresponding variable should not be included in the regression model.
A)True
B)False
Q3) Does the data provide enough evidence to conclude that,at the 5% significance level,the model is useful in predicting the final mark?
Q4) Test the null hypothesis H<sub>0</sub> : <sub>1</sub><sub> </sub>= <sub>2</sub> = <sub>3</sub><sub> </sub>= 0 against H<sub>1</sub> : At least one <sub>j</sub> 0,j = 1,2,3 at the 1% significance level.
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Chapter 13: Additional Topics in Regression Analysis
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Sample Questions
Q1) The value of the dependent variable in an earlier time period is called a lagged dependent variable.
A)True
B)False
Q2) Suppose you are interested in modeling the amount of money a firm spends on marketing their product.In order to have your results be of interest to a wide audience,you collect data from a variety of firms ranging from those who spend quite little on advertising to those that spend quite a bit.If you model advertising expenditures as a function of gross sales,your results might be subject to:
A)autocorrelation.
B)heteroscedasticity.
C)multicollinearity.
D)specification bias.
Q3) Explain what is meant by specification bias.What effects does specification bias have on the results of a regression?
Q4) What problems can occur when the independent variables are correlated with each other?
Q5) Briefly discuss what is meant by the "dummy variable trap".
Q6) Interpret the coefficient b<sub>1</sub>.
Page 15
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Chapter 14: Analysis of Categorical Data
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Sample Questions
Q1) When doing a chi-square and goodness-of-fit test,the squared difference between the observed and theoretical frequencies should be large if a null hypothesis is to be rejected.
A)True B)False
Q2) The Wilcoxon rank sum test is similar to the Mann-Whitney U test.The results will be the same for both tests.
A)True B)False
Q3) A marketing researcher asked a sample of 120 consumers regarding their preferred packaging for a new product.They had four different package styles to choose from.Of the 120 people,39 preferred Package A,27 preferred Package B,24 preferred Package C,and the rest preferred Package D.Is there evidence to suggest that the preferences are evenly spread among the four packages?
Q4) When should you use a nonparametric test? If the normality assumptions are met,are you better off using a parametric t-test to a nonparametric Rank Test?
Q5) Test for association at 5% significance level.
Q6) Can we infer at the 5% significance level that the population locations differ?
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Chapter 15: Analysis of Variance
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Sample Questions
Q1) Is there sufficient evidence to reject the null hypothesis that there is no difference between the three exam forms? Use = 0.05.
Q2) The value for F<sub>3,15,0.01</sub><sub> </sub>in a one-way ANOVA is found to be 26.87.
A)True
B)False
Q3) What is the degrees of freedom value for Blocks?
A)8
B)2
C)4
D)5
Q4) The total number of degrees of freedom is equal to:
A)25
B)23
C)24
D)26
Q5) Is there sufficient evidence to reject the null hypothesis that there is no difference between the regions of the country? Use = 0.05.
Q6) How many experimental units were in this study?
Page 17
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Chapter 16: Time-Series Analysis and Forecasting
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Sample Questions
Q1) The number of forecast values determined is:
A)10.
B)3.
C)24.
D)21.
Q2) The time series that reflects a wavelike pattern describing a long-term trend that is generally apparent over a number of years is called the:
A)trend component.
B)cyclical component.
C)seasonal component.
D)irregular component.
Q3) What is the sales forecast for the 3<sup>rd</sup> quarter of year 4?
A)approximately 133 units
B)approximately 269 units
C)approximately 140 units
D)approximately 369 units
Q4) Seasonality is a time-series component.
A)True
B)False
Q5) What is the forecast for the year 1945 if its real home price index is 98.056?
Page 18
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Chapter 17: Additional Topics in Sampling
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Sample Questions
Q1) Find a 95% confidence interval for the total sales.
Q2) Estimate the proportion of all invoices that are from out-of-state suppliers.
Q3) Find a 95% confidence interval for the mean rating given by all freshmen and sophomores on the campus.
Q4) A statistician observed,for the population mean,a confidence interval running from $119.42 to $135.42.What is the probability of this interval? What is ?
Q5) Find a 90% confidence interval for the mean rating given by all freshmen and sophomores on the campus.
A)3.98 ± 0.592
B)3.98 ± 0.229
C)3.98 ± 0.712
D)3.98 ± 0.456
Q6) Using an unbiased estimation procedure,find an estimate of the variance of the sample mean.
Q7) Estimate the total expenditures for the population.
Q8) Find a 90% confidence interval for the population.
Q9) Estimate the proportion of all accounts that placed an order within the last 30 days.
Q10) Explain cluster sampling and state its advantages.
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