FINANCE 208 HOMEWORK 4
QUESTIONS WITH ACCURATE
ANSWERS
A 99% confidence interval estimate can be interpreted to mean that I. if all
possible samples of size n are taken and confidence interval estimates are
developed, 99% of them would include the true population mean somewhere
within their interval. II. we have 99% confidence that we have selected a sample
whose interval does include the population mean. correct answer I and II
A confidence interval was used to estimate the proportion of statistics students
who are female. A random sample of 72 statistics students generated the
following 90% confidence interval: (0.438, 0.642). Using the information above,
what total size sample would be necessary if we wanted to estimate the true
proportion to within ±0.08 using 95% confidence? correct answer 150
A hotel chain wants to estimate the mean number of rooms rented daily in a
given month. The population of rooms rented daily is assumed to be normally
distributed for each month with a standard deviation of 240 rooms. During
February, a sample of 25 days has a sample mean of 370 rooms. (The answer
should be rounded to 2 decimal points)Referring to Scenario 8-7, the critical value
for a 99% confidence interval for this sample is ________. correct answer 2.58
A major department store chain is interested in estimating the mean amount its
credit card customers spent on their first visit to the chain's new store in the mall.
Fifteen credit card accounts were randomly sampled and analyzed with the
following results: = $50.50 and S = 20. Construct a 95% confidence interval for the
mean amount its credit card customers spent on their first visit to the chain's new
store in the mall assuming that the amount spent follows a normal distribution.
correct answer $50.50 ± $11.08
, A manager of the credit department for an oil company would like to determine
whether the mean monthly balance of credit card holders is equal to $75. An
auditor selects a random sample of 100 accounts and finds that the mean owed is
$83.40 with a sample standard deviation of $23.65. If you were to conduct a test
to determine whether the auditor should conclude that there is evidence that the
mean balance is different from $75, which test would you use? correct answer t
test of population mean
A pizza chain is considering opening a new store in an area that currently does not
have any such stores. The chain will open if there is evidence that more than
5,000 of the 20,000 households in the area have a favorable view of its chain. It
conducts a telephone poll of 300 randomly selected households in the area and
finds that 96 have a favorable view. State the test of hypothesis that is of interest
to the pizza chain. correct answer H0: π ≤ 0.25 versus H1: π > 0.25
A pizza chain is considering opening a new store in an area that currently does not
have any such stores. The chain will open if there is evidence that more than
5,000 of the 20,000 households in the area have a favorable view of its chain. It
conducts a telephone poll of 300 randomly selected households in the area and
finds that 96 have a favorable view. The p-value associated with the test statistic
in this problem is approximately equal to: correct answer 0.0026
A survey claims that 9 out of 10 doctors recommend aspirin for their patients with
headaches. To test this claim against the alternative that the actual proportion of
doctors who recommend aspirin is less than 0.90, a random sample of 100
doctors was selected. Suppose you reject the null hypothesis. What conclusion
can you reach? correct answer There is sufficient evidence that the proportion of
doctors who recommend aspirin is less than 0.90.
QUESTIONS WITH ACCURATE
ANSWERS
A 99% confidence interval estimate can be interpreted to mean that I. if all
possible samples of size n are taken and confidence interval estimates are
developed, 99% of them would include the true population mean somewhere
within their interval. II. we have 99% confidence that we have selected a sample
whose interval does include the population mean. correct answer I and II
A confidence interval was used to estimate the proportion of statistics students
who are female. A random sample of 72 statistics students generated the
following 90% confidence interval: (0.438, 0.642). Using the information above,
what total size sample would be necessary if we wanted to estimate the true
proportion to within ±0.08 using 95% confidence? correct answer 150
A hotel chain wants to estimate the mean number of rooms rented daily in a
given month. The population of rooms rented daily is assumed to be normally
distributed for each month with a standard deviation of 240 rooms. During
February, a sample of 25 days has a sample mean of 370 rooms. (The answer
should be rounded to 2 decimal points)Referring to Scenario 8-7, the critical value
for a 99% confidence interval for this sample is ________. correct answer 2.58
A major department store chain is interested in estimating the mean amount its
credit card customers spent on their first visit to the chain's new store in the mall.
Fifteen credit card accounts were randomly sampled and analyzed with the
following results: = $50.50 and S = 20. Construct a 95% confidence interval for the
mean amount its credit card customers spent on their first visit to the chain's new
store in the mall assuming that the amount spent follows a normal distribution.
correct answer $50.50 ± $11.08
, A manager of the credit department for an oil company would like to determine
whether the mean monthly balance of credit card holders is equal to $75. An
auditor selects a random sample of 100 accounts and finds that the mean owed is
$83.40 with a sample standard deviation of $23.65. If you were to conduct a test
to determine whether the auditor should conclude that there is evidence that the
mean balance is different from $75, which test would you use? correct answer t
test of population mean
A pizza chain is considering opening a new store in an area that currently does not
have any such stores. The chain will open if there is evidence that more than
5,000 of the 20,000 households in the area have a favorable view of its chain. It
conducts a telephone poll of 300 randomly selected households in the area and
finds that 96 have a favorable view. State the test of hypothesis that is of interest
to the pizza chain. correct answer H0: π ≤ 0.25 versus H1: π > 0.25
A pizza chain is considering opening a new store in an area that currently does not
have any such stores. The chain will open if there is evidence that more than
5,000 of the 20,000 households in the area have a favorable view of its chain. It
conducts a telephone poll of 300 randomly selected households in the area and
finds that 96 have a favorable view. The p-value associated with the test statistic
in this problem is approximately equal to: correct answer 0.0026
A survey claims that 9 out of 10 doctors recommend aspirin for their patients with
headaches. To test this claim against the alternative that the actual proportion of
doctors who recommend aspirin is less than 0.90, a random sample of 100
doctors was selected. Suppose you reject the null hypothesis. What conclusion
can you reach? correct answer There is sufficient evidence that the proportion of
doctors who recommend aspirin is less than 0.90.
