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1. Michael is running for president. The proportion of voters who favor Michael is 0.8. A simple random sample of 100
voters is taken.

a. What are the expected value, standard deviation, and shape of the sampling distribution of ?
What is the probability that the number of voters in the sample who will not favor Michael will
b.
be between 26 and 30?
What is the probability that the number of voters in the sample who will not favor Michael will
c.
be more than 16?

2. In order to determine the average price of hotel rooms in Atlanta, a sample of 64 hotels was selected. It was determined
that the average price of the rooms in the sample was $108.50 with a standard deviation of $16.
Formulate the hypotheses to determine whether or not the average room price is significantly
a.
different from $112.
b. Compute the test statistic.
c. Using the p-value approach, test the hypotheses. Let α = .1.

3. It has been suggested that night-shift workers show more variability in their output levels (units/week) than day
workers. Below, you are given the results of two independent random samples.
Night Shift Day Shift
Sample Size 9 8
Sample Mean 520 540
Sample Variance 38 20

a. State the null and alternative hypotheses to be tested.

b. Compute the test statistic.
c. Determine the p-value.
d. At the .05 level of significance, what do you conclude?

4. Independent random samples of managers' yearly salaries (in $1000) taken from governmental and private
organizations provided the following information. At a .05 level of significance, test to determine if there is a significant
difference between the average salaries of the managers in the two sectors.
Government Private
80 75
s 9 10
n 28 31

5. Allied Corporation is trying to determine whether to purchase Machine A or B. It has leased the two machines for a
month. A random sample of 5 employees has been taken. These employees have gone through a training session on both
machines. Below you are given information on their productivity rate on both machines. (Let the difference d = Machine
A - Machine B.)
              Productivity Rate
Person Machine A Machine B
1 47 52
2 53 58
3 50 47
4 55 60
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5 45 53

Assume the population of differences is normally distributed.

a. State the null and alternative hypotheses for a lower tail test.
b. Find the mean and standard deviation for the difference.
c. Compute the test statistic.
d. Test the null hypothesis, stated in Part a, at the 10% level.

6. Last school year, in the school of Business Administration, 30% were Accounting majors; 24% Management majors;
26% Marketing majors; and 20% Economics majors. A sample of 1000 students taken from this year's students of the
school showed the following number of students in each major:
Accounting 275
Management 240
Marketing 280
Economics 205
Total 1000

We want to see if there has been a significant change in the proportion of students in each major.
a. Compute the test statistic.
Has there been any significant change in the proportion of students in each major between the
b.
last school year and this school year? Use the p-value approach and let α = .05.

7. Below you are given ages that were obtained by taking a random sample of 6 undergraduate instructors at a university.
Assume the population has a normal distribution.
40 42 43 39 37 39

a. What is the point estimate of μ?

b. Determine the standard deviation.
c. Construct a 90% confidence interval for the average age of undergraduate instructors.
d. Construct a 99% confidence interval for the average age of undergraduate instructors.
e. Discuss why the 90% and 99% confidence intervals are different.

8. Ten observations were selected from each of three populations, and an analysis of variance was performed on the data.
The following are the results:
Source of Sum of Degrees of Mean
Variation Squares Freedom Square F
Between
Treatments 82.4
Within
Treatments 158.4
(Error)

Using α = .05, test to see if there is a significant difference among the means of the three
a.
populations. State the null and alternative hypotheses.
If, in Part a, you concluded that at least one mean is different from the others, determine which
b. mean is different. The three sample means are  = 24.8,  = 23.4, and  = 27.4.
Use α = .05.

9. A sample of 144 cans of coffee showed an average weight of 32 ounces. The standard deviation of the population is
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known to be 1.4 ounces.
a. Construct a 68.26% confidence interval for the mean of the population.
b. Construct a 97% confidence interval for the mean of the population.
c. Discuss why the answers in Parts a and b are different.

10. A university planner is interested in determining the percentage of spring semester students who will attend summer
school. She takes a pilot sample of 160 spring semester students discovering that 56 will return to summer school.
Construct a 95% confidence interval estimate for the percentage of spring semester students
a.
who will return to summer school.
Using the results of the pilot study with a .95 probability, how large of a sample would have to
b.
be taken to provide a margin of error of 3% or less?

11. A student believes that no more than 20% (i.e., 20%) of the students who finish a statistics course get an A. A
random sample of 100 students was taken. Twenty-four percent of the students in the sample received 'A's.
a. State the null and alternative hypotheses.
b. Using the critical value approach, test the hypotheses at the 1% level of significance.
c. Using the p-value approach, test the hypotheses at the 1% level of significance.

12. The SAT scores have an average of 1200 with a standard deviation of 200. A sample of 64 scores is selected.
a. What is the probability that the sample mean will be larger than 1224?
b. What is the probability that the sample mean will be less than 1230?
c. What is the probability that the sample mean will be between 1200 and 1214?
d. What is the probability that the sample mean will be greater than 1200?

13. The marketing department of a company has designed three different packing boxes for its product. It wants to
determine which box will produce the largest amount of sales. Each box will be test-marketed in five different stores for a
period of a month. Below you are given the information on sales (in dollars).
Store 1 Store 2 Store 3 Store 4 Store 5
Box 1 210 230 190 180 190
Box 2 195 170 200 190 193
Box 3 295 275 290 275 265

a. State the null and alternative hypotheses.

b. Construct an ANOVA table.
c. What conclusion do you draw?
Use Fisher's LSD procedure and determine which mean (if any) is different from the others.
d.
Let α = .01.

14. Shown below is a portion of a computer output for a regression analysis relating supply (y in thousands of units) and
unit price (x in thousands of dollars).
ANOVA
df SS
Regression   1   354.689
Residual 39 7035.262
Coefficients Standard Error
Intercept 54.076 2.358
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x   0.0294 0.021

a. What has been the sample size for this problem?

b. Perform a t test and determine whether or not supply and unit price are related. Let α = .05.
c. Perform an F test and determine whether or not supply and unit price are related. Let α = .05.
d. Compute the coefficient of determination and interpret its meaning. Be very specific.
Compute the coefficient of correlation and explain the relationship between supply and unit
e.
price.
f. Predict the supply (in units) when the unit price is $50,000.

15. A sample of 150 individuals (males and females) was surveyed, and the individuals were asked to indicate their yearly
incomes. Their incomes were categorized as follows.
Category 1 $20,000 up to $40,000
Category 2 $40,000 up to $60,000
Category 3 $60,000 up to $80,000

The results of the survey are shown below.

Income Category Male Female
Category 1 10 30
Category 2 35 15
Category 3 15 45

We want to determine if yearly income is independent of gender.

a. Compute the test statistic.
Using the p-value approach, test to determine if yearly income is independent of gender. Use α
b.
= .05.

16. On the average, 8.2 cars arrive at the drive-up window of a bank every hour. Define the random variable x to be the
number of cars arriving in any hour.
What is the appropriate probability distribution for x? Explain how x satisfies the properties of
a.
the distribution.
b. Compute the probability that exactly 5 cars will arrive in the next hour.
c. Compute the probability that no more than 4 cars will arrive in the next hour.

17. The scores of a sample of 5 students, selected from a large population, are given below.
Score
70
80
60
90
75

a. Determine a point estimate for the variance of the population.

b. Determine a 98% confidence interval for the variance of the population.
At the 5% level of significance, test to determine if the variance of the population is less than
c.
or equal to 50.

18. A sample of 30 houses that were sold in the last year was taken. The value of the house (y, in dollars) was estimated.

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The independent variables included in the analysis were the number of rooms (x1), the size of the lot (x2, in sq ft), the
number of bathrooms (x3), and a dummy variable (x4), which equals 0 if the house does not have a garage and equals 1
otherwise. The following regression results were obtained:
Coefficients Standard Error
Intercept 15,232.5 8462.5
x1 2178.4 778.0
x2 7.8 2.2
x3 2675.2 2229.3
x4 1157.8 463.1

ANOVA
df SS MS
Regression 204,242.88 51,060.72
Residual (Error) 205,890.00 8235.60

a. Write out the estimated regression equation.

b. Interpret the coefficient on the number of rooms (x1).
c. Interpret the coefficient on the dummy variable (x4).
What are the degrees of freedom for the sum of squares explained by the regression (SSR) and
d.
the sum of squares due to error (SSE)?
Test whether or not there is a significant relationship between the value of a house and the
e. independent variables. Use a .05 level of significance. Be sure to state the null and alternative
hypotheses.
f. Test the significance of β1 at the 5% level. Be sure to state the null and alternative hypotheses.
g. Compute the multiple coefficient of determination and interpret its meaning.
Estimate the value of a house (in dollars) that has 9 rooms, a lot with an area of 7500 sq ft,
h.
2 bathrooms, and 2 garages.

19. Two hundred students are enrolled in an Economics class. After the first examination, a random sample of 6 papers
was selected. The scores were 65, 75, 89, 71, 70, and 80.
a. Determine the standard error of the mean.
What assumption must be made before we can determine an interval for the mean score of all
b.
the students in the class? Explain why.
Assume the assumption of Part b is met. Provide a 95% confidence interval for the mean score
c.
of all the students in the class.

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