Harambee University

Faculty of Business and Economics

Post Graduate program
Department of PM
Course Name: Statistical Methods (MPM 682)
Individual Assignment II (25%)

General Directions
I. Assignment submission format: Assignment must be submitted in both hard copy
and soft copy.
II. The soft copy should be emailed to nanatibatu@gmail.com.
III. The hard copy assignment submission date: Final Exam Date

1. A company believes that roughly 35% of consumers rate its brand first in quality. It
would like to estimate the proportion more accurately and retains a market research firm
to survey n consumers.

Using the initial estimate of 35% as a guide, determine how large n must be to ensure that
there is only a 5% chance that the estimate from the survey will differ from the true value
by more than 3 percentage points.

2. A wireless communication company is considering switching from a per-minute charge

to a flat monthly fee for unlimited service. It anticipates that this will result in greater
usage and would like to estimate what the average number of minutes per month per
customer will be under the new plan. To do this, it offers 1000 customers the flat-fee plan
for one month and tracks their usage. From past data, the company knows that the
standard deviation of monthly minutes is about 120 minutes; the company expects that
this figure will not change much under the new plan.
Find the probability that the average among the 1000 test customers will differ from the
true mean by more than 5 minutes.

3. (a) The starting salary among 1999 graduates of the Evangelican Business School has a
standard deviation of $17,000. If you randomly survey 40 students and average their
starting salaries, what is the probability that the average among these students will be
greater than the average among all students?
(b) What is the probability that the average in the sample will exceed the average among
all students by more than $5,000?
(c) What is the probability that the average in the sample will differ from the average
among all students by more than $5,000?

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4. A set of 1000 test scores has a symmetric, mound-shaped distribution. The mean is 175 and
the standard deviation is 10.
a) Approximately how many scores are between 155 and 165 (indicate in an empirical rule
that applies to bell-shaped distributions)?
b) Approximately what percent of the scores are between 175 and 195 (indicate in an
empirical rule that applies to bell-shaped distributions)?

5. A testing lab wishes to test two experimental brands of outdoor paint to see how long each
will last before fading. The testing lab makes 6 gallons of each paint to test. Since different
chemical agents are added to each group and only six cans are involved, these two groups
constitute two small populations. The results (in months) are shown below.
Brand A Brand
B
10 35
60 45
50 30
30 35
40 40
20 25
Based on the results (in months) shown in the above table, compute the following problems
a. Find the mean of each group (Brand A and Brand B).
b. Find the variance and standard deviation for the data set for brand A paint
c. Find the variance and standard deviation for brand B paint
6. In order to assess the effectiveness of the system, the consulting firm will study the payment
times for invoices processed during the first three months of the system’s operation. During
this period, 7,823 invoices are processed using the new system. To study the payment times of
these invoices, the consulting firm numbers the invoices from 0001 to 7823 and uses random
numbers to select a random sample of 65 invoices. The resulting 65 payment times are given
in the followig table.
22 29 16 15 18 17 12 13 17 16 15
19 17 10 21 15 14 17 18 12 20 14
16 15 16 20 22 14 25 19 23 15 19
18 23 22 16 16 19 13 18 24 24 26
13 18 17 15 24 15 17 14 18 17 21
16 21 25 19 20 27 16 17 16 21
Table: A Sample of Payment Times (in Days) for 65 Randomly Selected Invoices.
Work on the following problems accordingly
1. Calculate sample mean for 65 Randomly Selected Invoices

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 2. Calculate the 68%, 95%, 99.7% degree of confidendeces for each principles of standad
deviations.
7. The final daily inspection defect report for a cabinet manufacturer is given in the table below:

1) Construct a Pareto diagram (A bar graph with the bars arranged from the most numerous
category to the least numerous category.) for this defect report. Management has given
the cabinet production line the goal of reducing their defects by 50%.
2) What two defects should they give special attention to in working toward this goal?
8. A city police officer, using radar, checked the speed of cars as they were traveling down the
main street in a town. Construct a stem-and-leaf plot for this data:
41 31 33 35 36 37 39 49 33 19 26 27 24 32 40 39 16 55 38 36

9. The hemoglobin test, a blood test given to diabetics during their periodic checkups, indicates the
level of control of blood sugar during the past two to three months. The data in the table below
was obtained for 40 different diabetics at a university clinic that treats diabetic patients:
6.5 5.0 5.6 7.6 4.8 8.0 7.5 7.9 8.0 9.2

6.4 6.0 5.6 6.0 5.7 9.2 8.1 8.0 6.5 6.6

5.0 8.0 6.5 6.1 6.4 6.6 7.2 5.9 4.0 5.7

7.9 6.0 5.6 6.0 6.2 7.7 6.7 7.7 8.2 9.0

1) Construct a grouped frequency distribution using the classes

3.7 - <4.7, 4.7 - <5.7, 5.7 - <6.7, etc.
2) Which class has the highest frequency?
10. A recent survey of Roman Catholic nuns summarized their ages in the table below.
Construct a histogram for this age data:
Age Frequency Class Midpoint
--------------------------------------------------------------------

20 up to 30 34 25

30 up to 40 58 35

40 up to 50 76 45

50 up to 60 187 55

60 up to 70 254 65
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70 up to 80 241 75

80 up to 90 147 85
11. Poor fitness in adolescents and adults increases the risk of cardiovascular disease. In a study
of 3110 adolescents and 2205 adults (Journal of the American Medical. Association,
December 21, 2005), researchers found 33.6% of adolescents and 13.9% of adults were
unfit; the percentage was similar in adolescent males (32.9%) and females (34.4%), but was
higher in adult females (16.2%) than in adult males (11.8%).
a. Summarize this information using a comparative bar graph that shows differences between
males and females within the two different age groups.
b. Comment on the interesting features of your graphical display.

12. A survey of 1001 adults taken by Associated PressIpsos asked “How accurate are the weather
forecasts in your area?” (San Luis Obispo Tribune, June 15, 2005).
The responses are summarized in the table below.
Extremely 4%
Very 27%
Somewhat 53%
Not too 11%
Not at all 4%
Not sure 1%

a. Construct a pie chart to summarize this data.

b. Construct a bar chart to summarize this data.
c. Which of these charts—a pie chart or a bar chart best summarizes the important information?
Explain.