A.

MULTIPLE CHOICE QUESTION (6 points): CHOOSE THE MOST CORRECT ANSWER

1.Which of the following does not represent one method to obtain primary source data?
A. Making observations C. Conducting an experiment
B. Sending a survey to customers D. Looking in professional magazines
2. The grades are a characteristic of the sample of students, while a statistic would be how many
“B”s were received by the random sample of students.
What method is used to sample a population so that it is representative of the population?
A. Samples are chosen at random from the population.
B. All but the observations that have the lowest and highest values are selected.4
C.
D. Every other element in a population is chosen.
E. Only the first half of a population is selected.
3. A consumer confidence researcher asks several retailers to report the number of LCD televisions
sold during a particular month. These numbers most likely represent what level of measurement?
A. Ratio B. Nominal C. Ordinal D. Interval
4. If you have a digital scale in your home that only reads in integers, is your weight a discrete
variable?
A. It depends on your weight.
B. No because weight is still a continuous variable regardless of the ability to measure it.
C. Yes because the scale reports integers.
D. It depends on the accuracy of the scale.
5. A question on a product registration card asks, “How much money do you plan to spend on DVD
movie purchases during the next 6 months?” What type of variable and level of measurement does
your response represent?
A. Continuous variable measured on a ratio scale.
B. Discrete variable measured on a nominal scale
C. Continuous variable measured on an interval scale.
D. Discrete variable measured on an ordinal scale.
6. The width of a class interval in a frequency distribution (or bar chart) will be approximately
equal to the range of the data divided by the
A. number of class intervals C. average of the data set
B. lowest value in the data set D. highest value in the data set
7. When constructing a frequency distribution, which of the following rules must be followed?
A. The number of classes must be an even number.
B. Adjacent classes cannot overlap
C. The midpoint of each class must be an integer.
D. The width of each class is equal to the lowest value in the data set.

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8. Which of the following would be most helpful in the construction of a pie chart?
A. relative frequencies C. cumulative percentages
B. frequency distribution D. ogive
9. Which of the below histograms represents the graph of city restaurant meal prices with an
interval of $8?

A. Only the histogram on the left C. Only the histogram on the right
B. Both histograms D. Neither histogram
10. The table below shows the frequency and relative frequencies for 7 groups of restaurant meal
prices. How was the value of 0.36 obtained for the relative frequency of meals costing $32 but less
than $40?
Cost per Restaurant Meal City
($) Frequency Relative Frequency
8 but less than $16 1 0.02
16 but less than $24 2 0.04
24 but less than $32 6 0.12
32 but less than $40 18 0.36
40 but less than $48 10 0.2
48 but less than $56 11 0.22
56 but less than $64 2 0.04
A. The number of data points is 50, so divide 18 by 50. C. (18/100) x 2 = 0.36.
B. The midpoint of the class is $36, so divide 36 by 100. D. (18 x 2)/100 = 0.36.
11. Which of the following measures of central tendency is not affected by extreme values in the
sample data set?
A. Median and Mode C. Median
B. Mode D. Mean
12. The sum of deviations about the arithmetic mean is always equal to
A. Variance C. 0
B. 1 D. Geometric Mean

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13. Which of the following sampling techniques will not result in a probability sample?
A. Quota C. Stratified
B. Systematic D. Random
14. A human resources department processes reimbursement requests for travel expenses. Three
hundred completed forms were submitted in the past month, and in order to estimate the average
travel expense, the HR Director constructs a sampling procedure that will begin with the 7 th
expense form and collect every 10th form thereafter (17th, 27th, etc.). This procedure results in
which of the following types of samples?
A. simple random C. systematic
B. stratified D. convenience
Note: Questions #15-#16 are based on the following grouped frequency table of the income, x, of 30
employees at a local small business (in $1000s).

Income $26<x#$28 $28<x#$30 $30<x#$32 $32<x#$34 $34<x#$36

Frequency 2 11 8 5 4

15. Using class-midpoints as representative values, we can estimate the mean for this data as:
A. $30,870 C. $30,500
B. $29,790 D. $31,340
st
16. If the boss’ income (the “31 employee”) is $250,000, the mean income for all 31 workers is
approximately equal to
A. $8,000 C. $140,000
B. $38,000 D. $220,000
17. The distribution beside is:
A. skewed to the right
B. normally distributed
C. skewed to the left
D. symmetric

18. A 95% confidence interval for the mean can be

interpreted to mean which of the following?
A. You can be 95% certain that you have selected a sample with a corresponding confidence interval that
includes the population mean.
B. If all possible samples are taken and confidence intervals are calculated, 95% of those intervals will
include the true population mean.
C. Both of the above are correct.
D. None of the above is correct.
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19. What test should a researcher use to determine whether there is evidence that the mean family
income in the U.S. is greater than $40,000?
A. Two-tail test C. Acceptance-Rejection test
B. One-tail test D. None of the above
20. A statistician wishes to determine the difference between two population means. A sample of 10
items from Population #1 yields a mean of 185 with a standard deviation of 20. The sample of 12
items from Population #2 yields a mean of 200 with a standard deviation of 25. Assume that the
values are normally distributed in each population. How many degrees of freedom are there for
this test?
A. 11 C. 21
B. 22 D. 20
21. When comparing the difference between two population proportions, a pooled estimate of the
population proportion can be used for two-tail tests where the null hypothesis assumes that the
population proportions are equal. What is the alternate hypothesis?
A. H1: p1 < p2 C. H1: p1 > p2
B. H1: p1 = p2 D. H1: p1 not equal to p2
22. In a study of possible correlation between the height in cm (X) and weight in kg (Y) of
chimpanzees, a sample of 40 animals produces a correlation coefficient of r = +0.813 and a
regression line with equation . What is the expected weight of an 80 cm tall
chimpanzee?
A. 46.7 kg C. 24.0 kg
B. 34.8 kg D. 57.1 kg
23. Which of the following statements is correct regarding moving averages?
A. The moving average for annual time series data should include an even number of years.
B. There are always 5 periods included in the moving average.
C. The choice of the number of periods impacts the performance of the moving average forecast
D. There are always 3 periods included in the moving average
24. Which of the following statements best describes the cyclical component?
A. It represents periodic fluctuations that recur within one year.
B. It is obtained by adjusting for calendar variation.
C. It represents periodic fluctuations that recur within the business cycle
D. It is obtained by summing the seasonal factors.
25. The method of moving averages is used for which of the following purposes?
A. plotting the time series C. estimate the trend
B. regression analysis D. smooth the time series

B. DISCUSSION (3 points)
The manufacturer of a gasoline additive claims that the use of this additive increases gasoline mileage. A
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random sample of 6 cars was selected, and these cars were driven for one week without the gasoline
additive and then for one week with the additive. The following table gives the mileage (in miles per
gallon) for these cars with and without the additive:

Car 1 2 3 4 5 6
Mileage Without Additive 24.6 28.3 18.9 23.7 15.4 29.5
Mileage With Additive 26.3 31.7 18.2 25.3 18.3 30.9

Assuming mileages are normally distributed, can you conclude that the use of the gasoline
additive increases mileage at the 2.5% significance level?
Solution:
Let new variable D be the difference, D=“mileage with - mileage without”.
Values for D are 1.7, 3.4, -0.7, 1.6, 2.9, 1.4, with mean Dbar=1.72, standard
deviation sD=1.43.

Now conduct hypothesis test, assuming that population of such differences is

normally distributed. Small sample: we must use t-values with d.f.=5
Step 1: H0: XD=0 or < = 0
H1: XD > 0 (claim)
Step 2: This is a right-sided rejection region with critical value t=2.571.

Step 3: Test statistic: t= (1.72 - 0) / (1.43/√6) = 2.94.

Step 4: Reject H0.

Step 5:At .025 significance level, there is sufficient evidence for the claim that
the additive increases mileage.

-THE END-

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