Government College University, Lahore

Department of Commerce & Finance

Mid Term Paper for B.Com. (Hons.) Session 2017-21 / Semester-V

Course Title: Inferential Statistics Marks: 20

Course Code: BC STAT-3101 Time Allowed: 60 Minutes

i. Candidate MUST write Question Number in the Answer Book in accordance with Question
Number in the Question Paper.
ii. Attempt ONLY THREE questions. (Question No. 1 is compulsory)
iii. Extra attempt of any question or any part of the attempted question will not be considered.

Question No. 1: Attempt any five among the following terms: (10 Marks)

1. Define Central Limit Theorem?

2. Define Sampling Error with formula?
3. What happens to the standard error of the mean if the sample size is increased?
4. Define Stratified Random Sampling with Example?
5. Define Margin of Error with formula?
6. How do we interpret the Confidence Interval?
7. When using sample means to estimate the population mean, what is the benefit of using
larger sample sizes?

Question No. 2: ------------------------------------------------------------------------------- (5 Marks)

Majesty Video Production Inc. wants the mean length of its advertisements to be 30 seconds.
Assume the distribution of ad length follows the normal distribution with a population standard
deviation of 2 seconds. Suppose we select a sample of 16 ads produced by Majesty.
a. What can we say about the shape of the distribution of the sample mean time?
b. What is the standard error of the mean time?
c. What percent of the sample means will be greater than 31.25 seconds?
d. What percent of the sample means will be greater than 28.25 seconds?
e. What percent of the sample means will be greater than 28.25 but less than 31.25 seconds?

Question No. 3: ------------------------------------------------------------------------------- (5 Marks)

Ms. Maria Wilson is considering running for mayor of Bear Gulch, Montana. Before
completing the petitions, she decides to conduct a survey of voters in Bear Gulch. A sample of
400 voters reveals that 300 would support her in the November election.
1. Estimate the value of the population proportion.
2. Develop a 99% confidence interval for the population proportion.
3. Interpret your findings.

Question No. 4: ------------------------------------------------------------------------------- (5 Marks)

Bob Nale is the owner of Nale’s Quick Fill. Bob would like to estimate the mean number of
gallons of gasoline sold to his customers. Assume the number of gallons sold follows the
normal distribution with a population standard deviation of 2.30 gallons. From his records, he
selects a random sample of 60 sales and finds the mean number of gallons sold is 8.60.
a. What is the point estimate of the population mean?
b. Develop a 99% confidence interval for the population mean.
c. Interpret the meaning of part (b).
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