KING ABDULAZIZ UNIVERSITY Business Statistics Chapter 7

Faculty of Science, Dep. of Statistics STAT 271

1. Which of the following is NOT true regarding the normal distribution?

A. Mean, median and B. It has a single peak C. It is symmetrical D. The points of the curve meet
mode are all equal the X-axis at z = -3 and z = 3

2. For the normal distribution, the mean plus and minus 1.96 standard deviations will include about what percent
of the observations?

A. 50% B. 99.7% C. 95% D. 68%

3. For a standard normal distribution, what is the probability that z is greater than 1.75?

A. 0.0401 B. 0.0459 C. 0.4599 D. 0.9599

4. What is the area under the normal curve between z = 0.0 and z = 1.79?

A. 0.4633 B. 0.0367 C. 0.9599 D. 0.0401

5. What is the area under the normal curve between z = -1.0 and z = -2.0?

A. 0.0228 B. 0.3413 C. 0.1359 D. 0.4772

6. What is the area under the normal curve between z = 0.0 and z = 2.0?

A. 1.0000 B. 0.7408 C. 0.1359 D. 0.4772

7. The mean amount spent by a family of four on food per month is $500 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

8. Which of the following is NOT a characteristic of the normal probability distribution?

A. Positively-skewed B. Bell-shaped C. Symmetrical D. Asymptotic

9. What is the proportion of the total area under the normal curve within plus and minus two standard deviations
of the mean?

A. 68% B. 99.7% C. 34% D. 95%

10. The mean score of a college entrance test is 500; the standard deviation is 75. The scores are normally
distributed. What percent of the students scored below 320?

A. About 50.82% B. About 34.13% C. About 7.86% D. About 0.82%

11. The mean of a normally distributed group of weekly incomes of a large group of executives is $1,000 and the
standard deviation is $100. What is the z-score for an income of $1,100?

A. 1.00 B. 2.00 C. 1.683 D. -0.90

12. The mean of a normal distribution is 400 pounds. The standard deviation is 10 pounds. What is the area
between 415 pounds and the mean of 400 pounds?

A. 0.5000 B. 0.1932 C. 0.4332 D. 0.3413

13. Tables of normal distribution probabilities are found in many statistics books. These probabilities are
calculated from a normal distribution with
A. a mean of 1 and a B. a mean of 100 and a C. a mean of 0 and a D. a mean of 0 and a
standard deviation of 1 standard deviation of 15 standard deviation of 15 standard deviation of 1

14. The total area of a normal probability distribution is

A. between -3.0 and 3.0 B. 1.00 C. dependent on a value of D. approximated by the
'z'. binomial distribution.

15. The weight of cans of fruit is normally distributed with a mean of 1,000 grams and a standard deviation of 50
grams. What percent of the cans weigh 860 grams or less?
A. 0.0100 B. 0.8400 C. 0.0026 D. 0.0001

16. The mean of a normal probability distribution is 500 and the standard deviation is 10. About 95 percent of the
observations lie between what two values?

A. 475 and 525 B. 480 and 520 C. 400 and 600 D. 350 and 650
 KING ABDULAZIZ UNIVERSITY Business Statistics Chapter 8
Faculty of Science, Dep. of Statistics STAT 271

1. When all the items in a population have an equal chance of being selected for a sample, the process is called
__________________.
A. Random sampling B. z-score C. Sampling error D. Nonprobability sampling

2. What is the difference between a sample mean and the population mean called?
A. Standard error of the B. Sampling error C. Interval estimate D. Point estimate
mean

3. What sample statistic is used to estimate a population parameter?

A. Parameter B. Sampling error C. Point estimate D. Interval estimate

4. Suppose we select every fifth invoice in a file. What type of sampling is this?
A. Random B. Cluster C. Stratified D. Systematic

5. 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. Exactly the same as B. Larger than the C. Smaller than the D. Cannot be estimated in
the population mean population mean population mean advance

6. When dividing a population into subgroups so that a random sample from each subgroup can be collected, what
type of sampling is used?
A. Simple random B. Systematic sampling C. Stratified random D. Cluster sampling
sampling sampling

7. An experiment involves selecting a random sample of 256 middle managers at random for study. One item of
interest is their mean annual income. The sample mean is computed to be $35,420 and the sample standard
deviation is $2,050. What is the standard error of the mean?
A. $128.125 B. $138.36 C. $2,050 D. $8.01

8. Suppose a research firm conducted a survey to determine the average amount of money steady smokers spend
on cigarettes during a week. A sample of 100 steady smokers revealed that the sample mean is $20 and the sample
standard deviation is $5. What is the probability that a sample of 100 steady smokers spend between $19 and $21?
A. 0.4772 B. 0.0228 C. 0.9544 D. $20
9. Which of the following is the standard error of the mean?
A. σ B. x/n C. σ/√n D. S

10. The wildlife department has been feeding a special food to rainbow trout fingerlings in a pond. A sample of
the weights of 40 trout revealed that the mean weight is 402.7 grams and the standard deviation 8.8 grams. What
is the probability that the mean weight for a sample of 40 trout exceeds 405.5 grams?
A. 0.3783 B. 0.0228 C. 1.0 D. 0.5

11. The mean weight of trucks traveling on a particular section of I-475 is not known. A state highway inspector
needs an estimate of the mean. He selects a random sample of 49 trucks passing the weighing station and finds the
mean is 15.8 tons, with a standard deviation of the sample of 4.2 tons. What is probability that a truck will weigh
less than 14.3 tons?
A. 0.0062 B. 0.3605 C. 0.1368 D. 0.4938

12. Mileage tests were conducted on a randomly selected sample of 100 newly developed automobile tires. The
average tread wear was found to be 50,000 miles with a standard deviation of 3,500 miles. What is the best
estimate of the average tread life in miles for the entire population of these tires?
A. 50,000 B. 3,500 C. (50,000/100) D. (3,500/100)

13. Based on the central limit theorem, the size of the sampling error is
A. Directly related to B. Directly related to C. Inversely related to the D. Inversely related to the
the sample size, i.e., the the population mean, sample size, i.e., the larger population standard
larger the sample size i.e., the larger the mean, the sample size the smaller deviation, i.e., the smaller
the larger the sampling the larger the sampling the sampling error. the standard deviation,
error. error. the larger the sampling
error.

14. For a distribution of sample means constructed by sampling 5 items from a population of 15,
A. the sample size is 15 B. there will be 3003 C. the mean of the sample D. the standard error will
possible sample means means will be 3 be 1
 KING ABDULAZIZ UNIVERSITY Business Statistics Chapter 9
Faculty of Science, Dep. of Statistics STAT 271

1. The mean number of travel days per year for salespeople employed by hardware distributors needs to be
estimated with a 0.90 degree of confidence. For a small pilot study the mean was 150 days and the standard
deviation was 14 days. If the population mean is estimated within two days, how many salespeople should be
sampled?
A. 133 B. 452 C. 511 D. 2100

2. The proportion of junior executives leaving large manufacturing companies within three years is to be
estimated within 3 percent. The 0.95 degree of confidence is to be used. A study conducted several years ago
revealed that the percent of junior executives leaving within three years was 21. To update this study, the files of
how many junior executives should be studied?
A. 594 B. 612 C. 709 D. 897

3. There are 2,000 eligible voters in a precinct. 500 of the voters are randomly selected and asked whether they
planned to vote for the Democratic incumbent or the Republican challenger. Of the 500 surveyed, 350 said they
would vote for the Democratic incumbent. Using the 0.99 confidence coefficient, what are the confidence limits
for the proportion that plan to vote for the Democratic incumbent?
A. 0.647 and 0.753 B. 0.612 and 0.712 C. 0.397 and 0.797 D. 0.826 and 0.926

4. A random sample of 85 group leaders and supervisors revealed that they worked an average of 6.5 years before
being promoted. The population standard deviation was 1.7 years. Using the 0.95 degree of confidence, what is
the confidence interval for the population mean?
A. 6.99 and 7.99 B. 4.15 and 7.15 C. 6.14 and 6.86 D. 6.49 and 7.49

5. The mean weight of trucks traveling on a particular section of I-475 is not known. A state highway inspector
needs an estimate of the mean. He selects a random sample of 49 trucks passing the weighing station and finds the
mean weight is 15.8 tons. The population standard deviation is 3.8 tons. What is the 95 percent interval for the
population mean?
A. 14.7 and 16.9 B. 13.2 and 17.6 C. 10.0 and 20.0 D. 16.1 and 18.1

6. Which of the following would be used as a point estimate for the population mean ( µ )?
A. σ B. x/n C. ̅ D. S

7. Mileage tests were conducted on a randomly selected sample of 100 newly developed automobile tires. The
results showed that the average tread life was 50,000 miles with a standard deviation of 3,500 miles. What is the
best estimate of the average tread life in miles for the entire population of these tires?
A. 50,000 B. 3,500 C. (50,000/100) D. (3,500/100)
8. For a given confidence interval, what is the interpretation of a 96% confidence level?
A. 96% chance that the B. Approximately 96 out C. 4% chance that the D. Both a and c are true
given interval includes of 100 such intervals would given interval does not
the true value of the include the true value of include
population parameter the population parameter the true value of the
population parameter

9. What kind of distribution is the t distribution?

A. Continuous B. Discrete C. Subjective D. z distribution

10. A random sample of 20 items is selected from a population. To determine the appropriate critical t-value what
number of degrees of freedom should be used?
A. 20 B. 19 C. 21 D. 25

11. The t distribution is similar to the z distribution in all BUT one of the following characteristics. Which one is
it?
A. Continuous B. Symmetrical C. Bell-shaped D. t distribution's mean = 0
and standard deviation = 1

12. Suppose 1,600 of 2,000 registered voters sampled said they planned to vote for the Republican candidate for
president. Using the 0.95 degree of confidence, what is the interval estimate for the population proportion (to the
nearest tenth of a percent)?
A. 78.2% to 81.8% B. 69.2% to 86.4% C. 76.5% to 83.5% D. 77.7% to 82.3%

13. A 95% confidence interval infers that the population mean

A. is between 0 and B. is within 1.96 standard C. is within 1.96 standard D. is too large
100% deviations of the sample mean errors of the sample mean

14. A random sample of 42 college graduates revealed that they worked an average of 5.5 years on the job before
being promoted. The sample standard deviation was 1.1 years. Using the 0.99 degree of confidence, what is the
confidence interval for the population mean?
A. 5.04 and 5.96 B. 5.06 and 5.94 C. 2.67 and 8.33 D. 4.40 and 6.60
 KING ABDULAZIZ UNIVERSITY Business Statistics Chapter 10
Faculty of Science, Dep. of Statistics STAT 271

1. What value does the null hypothesis make a claim about?

A. Population B. Sample statistic C. Sample mean D. Type II error
parameter

2. Test at the 0.01 level the statement that 55% of those families who plan to purchase a vacation residence in
Florida want a condominium. The null hypothesis is  = 0.55 and the alternate is  ≠ 0.55. A random sample of
400 families who planned to buy a vacation residence revealed that 228 families want a condominium. What
decision should be made regarding the null hypothesis?
A. Do not reject it B. Reject it C. Cannot accept nor reject it D. None of these
based on the information given

3. What is the level of significance?

A. Probability of Type II error B. Probability of Type I error C. z-value of 1.96 D. Beta error

4. The mean length of a small counter balance bar is 43 millimeters. There is concern that the adjustments of the
machine producing the bars have changed. Test the claim that there has been no change in the mean length. The
alternate hypothesis is that there has been a change. Twelve bars (n = 12) were selected at random. The mean of
the sample is 41.5 and the standard deviation 1.784. Has there been a statistically significant change in the mean
length of the bars, at a 0.05 significance level?
A. Yes, because the B. No, because the p-value C. No, because the D. Yes, because 43 is
p-value is smaller than α. is larger than α. computed t lies in the area to greater than 41.5
the right of -2.718.

5. A manufacturer wants to increase the shelf life of a line of cake mixes. Past records indicate that the average
shelf life of the mix is 216 days. After a revised mix has been developed, a sample of nine boxes of cake mix gave
these shelf lives (in days): 215, 217, 218, 219, 216, 217, 217, 218 and 218. At the 0.025 level, has the shelf life of
the cake mix increased?
A. Yes, because the B. Yes, because the C. No, because the p-value D. No, because 217.24
p-value is smaller than α. p-value is larger than α. is larger than α. is quite close to 216.

6. A manufacturer wants to increase the absorption capacity of a sponge. Based on past data, the average sponge
could absorb 3.5 ounces. After the redesign, the absorption amounts of a sample of sponges were (in ounces): 4.1,
3.7, 3.3, 3.5, 3.8, 3.9, 3.6, 3.8, 4.0, and 3.9. What is the decision at the 0.01 level of significance to test if the new
design increased the absorption amount of the sponge?
A. Do not reject null B. Do not reject null C. Reject null hypothesis D. Reject null hypothesis
hypothesis because p-value hypothesis because because p-value is less because p-value is larger
is larger than 0.01 p-value is less than 0.01 than 0.01 than 0.01
7. A machine is set to fill the small size packages of candies with mean 56 candies per bag. A sample revealed: 3
bags of 56, 2 bags of 57, 1 bag of 55, and 2 bags of 58. How many degrees of freedom are there?
A. 9 B. 1 C. 8 D. 7

8. A machine is set to fill the small size packages of candies with mean 56 candies per bag. A sample revealed: 3
bags of 56, 2 bags of 57, 1 bag of 55, and 2 bags of 58. What is the p-value to test that the mean per bag is larger
than 56?
A. 0.0573 B. 0.0698 C. 0.9312 D. 0.167

9. A random sample of size 15 is selected from a normal population. The population standard deviation is
unknown. Assume that a two-tailed test at the 0.10 significance level is to be used. What is the statistic to test for
the mean?
A. Z B. t C. Both Z and t D. Non of the previous

10. What is a Type II error?

A. Accepting a false null B. Rejecting a false null C. Accepting a false D. Rejecting a false
hypothesis hypothesis alternate hypothesis alternate hypothesis

11. If the alternate hypothesis states that µ does not equal 4,000, what is the rejection region for the hypothesis
test?
A. Both tails B. Lower or left tail C. Upper or right tail D. Center

12. If the 1% level of significance is used and the p-value is 0.001, what is our decision?
A. Do not reject H0 B. Reject H0 C. Reject H1 D. None of these

13. The Quality Assurance Department for Cola Inc. is interested in the amount of cola in its bottle. The mean
amount per bottle is 31.2 ounces and the population standard deviation is 0.4 ounces. A sample of 16 bottles was
randomly selected. The sample mean was 31.38 ounces then the value of z statistic is:
A. 7.2 B. 1.8 C. 5.4 D. Cannot be calculated

14. The Quality Assurance Department for Cola Inc. is interested in the amount of cola in its bottle. The mean
amount per bottle is 31.2 ounces and the population standard deviation is 0.4 ounces. A sample of 16 bottles was
randomly selected. The sample mean was 31.38 ounces then the p-value in to test that the population mean has
increased is:
A. 0.9651 B. 0.0035 C. 0.0359 D. 1.8