In a finance class, the final grade is based on three tests. Historically, the instructor tells
the class that the joint probability of scoring “A”‘s on the first two tests is 0.5. A student
assigns a probability of 0.9 that she will get an “A” on the first test. What is the
probability that the student will score an “A” on the second test given that she scored an
“A” on the first test?
A. 0.50
B. 0.95
C. 0.55
D. 0.90
Which statement is correct about the F distribution?
A. Cannot be negative
B. Cannot be positive
C. Is the same as the t distribution
D. Is the same as the z distribution
Given the least squares regression equation, Ŷ = 1,202 + 1,133X, when X = 3, what
does Ŷ equal?
A. 5,734
B. 8,000
C. 4,601
D. 4,050
The production of car tires in any given year is related to the number of cars produced
that year and in prior years. Suppose our econometric model resulted in the following
data.
Which variable in the model is the most significant predictor of tire production?
Consider the multiple regression model shown next between the dependent variable Y
and three independent variables X1, X2, and X3, which result in the following function:
For this model, there were 35 observations; SSR = 1400 and SSE = 600.
Based on the information given, it can be concluded that:
A. the coefficient of X3 is significant.
B. the regression model is not significant.
C. the coefficient of X1 is significant.
D. the regression model is significant.
If all the plots on a scatter diagram lie on a straight line, what is the standard error of
estimate?
A. -1
B. +1
C. 0
D. Infinity
Fifty-five voters from a sample of 80 indicated that they favored casino gambling in
their city. The city council is interested in finding out whether or not there is a
significant difference between the proportions of those favoring and not favoring casino
gambling in their community.
μ in this scenario is ______.
A. 55
B. 80
C. 40
D. 25
A statewide sample survey is to be made. First, the state is subdivided into counties.
Seven counties are selected at random and further sampling is concentrated on these
seven counties. What type of sampling is this?
A. Simple random
B. Systematic random sampling
C. Cluster sampling
D. Stratified sampling
For a null hypothesis, H0: = 4,000, if the 1% level of significance is used and the z-test
statistic is +6.00, what is our decision regarding the null hypothesis?
A. Do not reject H0.
B. Reject H0.
C. Reject H1.
D. None Apply.
The net annual sales of a sample of small retail clothing stores were organized into the
following relative frequency distribution.
What is the mean net sales (in $ millions)?
A. $7.09
B. $10.09
C. $8.59
D. Mean cannot be computed.
The joint probability of two independent events, A and B, is computed as P(A and B) =
P(A) P(B).
Respondents were asked, “Do you now earn more than or less than you did five years
ago?” What is this level of measurement?
A. Interval
B. Ratio
C. Nominal
D. Ordinal
For people released from prison, the following table shows their adjustment to civilian
life and place of residence.
What is the critical value for this contingency table at the 0.01 level of significance?
A. 9.488
B. 2.070
C. 11.345
D. 13.277
The 75th percentile is referred to as the:
A. first quartile.
B. second quartile.
C. third quartile.
D. fourth quartile.
A collection of data recorded over a weekly, monthly, quarterly, or yearly time interval
is known as ___________.
A. a weighted moving average
B. a time series
C. a linear trend
D. seasonal variation
To test if an observed frequency distribution with five classes is normally distributed,
we need to ___________.
A. Compute an F-statistic
B. Calculate a t-statistic
C. Convert the class marks to standard normal z-statistics
D. Convert the class limits to standard normal z-statistics
A student was studying the political party preferences of a university’s student
population. The survey instrument asked students to identify their political preference,
for example, Democrat, Republican, Libertarian, or another party. The best way to
illustrate the frequencies for each political preference is a __________.
A. Bar chart
B. Box plot
C. Histogram
D. Frequency polygon
In an ANOVA table for a multiple regression analysis, total variation is separated into
_________.
A. Treatment and error variation
B. Regression and residual variation
C. Treatment and block variation
D. Block and error variation
The mean amount spent by a family of four on food is $500 per month with a standard
deviation of $75. Assuming that the food costs are normally distributed, what is the
probability that a family spends less than $410 per month?
A. 0.2158
B. 0.8750
C. 0.0362
D. 0.1151
What is “a” in the least squares trend equation?
A. The intercept
B. The slope
C. The forecast
D. The time period
All possible samples of size n are selected from a population and the mean of each
sample is determined. What is the mean of the sample means?
A. The population mean.
B. It is larger than the population mean.
C. It is smaller than the population mean.
D. It cannot be estimated in advance.
A recent study focused on the amount of money single men and women save monthly.
The information is summarized next. Assume that the population standard deviations
are equal.
At the .01 significance level, do women save more money than men? What is the value
of the test statistic for this hypothesis test?
A. +6.213
B. +1.318
C. +2.632
D. +2.40
Refer to the following distribution:
What are the class limits for the class with the highest frequency?
A. 55 up to 64
B. 54 up to 64
C. 55 up to 65
D. 55 up to 64.5
Random samples of four items are selected from a manufacturing process at regular
intervals and a certain quality characteristic is measured. After 25 samples, ΣX =
15,350 and ΣR = 411.4. To construct a range chart, what is the upper control limit
(UCL) for the range?
A. 37.553
B. 411.4
C. 0.00
D. 102.85
There are several indexes that reflect the overall economic activity in the United States.
The federal government puts out an index of leading economic indicators. It includes
such diverse economic indicators as stock prices, new orders for plants and equipment,
and building permits issued. These indexes are usually referred to as
_______________.
When classes in a frequency table are constructed so that each observation will fit into
only one class, the categories are ______________________.
A population consists of 12 values. How many samples of size six are possible?
When the variance of the differences between the actual and the predicted values of the
dependent variable are approximately the same for all values of the independent
variable, the differences are said to exhibit ______________.
In statistical decision making, the act or decision alternative yielding the maximum
expected payoff also yields the minimum ________________.
To compute an expected monetary value, it requires that ______________ are estimated
for each state of nature.
Records on a fleet of trucks reveal that the average life of a set of spark plugs is
normally distributed with a mean of 22,100 miles. The fleet owner purchased 18 sets
and found that the sample average life was 23,400 miles; the sample standard deviation
was 1,412 miles. To determine if the spark plugs average 22,100 miles, what is the
critical value for the test using a 0.05 level of significance?
When estimating a population mean with a confidence interval, a smaller margin of
error requires a _________ sample size.
A major disadvantage of the unweighted price index is that
___________________________.