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QMB 3200 Test 1 | Business Statistics –
Descriptive Statistics & Probability |
Multiple Choice & Open-Ended Q&A |
Verified Answers
Exam Structure:
Subject: Business Statistics – Descriptive Statistics & Probability (QMB 3200)
Source: QMB 3200 Test 1 – Verified Answers
Format: Multiple Choice & Open-Ended Q&A
1. What is the z-score formula?
Correct Answer: (observation – mean) / standard deviation
Rationale:
1. The z-score measures how many standard deviations an observation is
from the mean.
2. A positive z-score indicates the observation is above the mean.
3. A negative z-score indicates the observation is below the mean.
4. Z-scores allow comparison of values from different distributions.
2. What does a z-score tell us?
Correct Answer: How many standard deviations a value is from the mean.
Rationale:
1. Z-scores standardize data, making it unit-free.
2. In a normal distribution, about 68% of data falls between z = -1 and z =
+1.
3. About 95% falls between z = -2 and z = +2.
4. About 99.7% falls between z = -3 and z = +3 (Empirical Rule).
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3. How do you find the range?
Correct Answer: Biggest value minus smallest value.
Rationale:
1. The range is the simplest measure of dispersion.
2. It is sensitive to outliers (extreme values).
3. Formula: Range = Maximum – Minimum.
4. Does not describe variability within the middle of the distribution.
4. What is the Excel formula to find the range?
Correct Answer: =MAX(array) – MIN(array)
Rationale:
1. MAX returns the largest value in the range.
2. MIN returns the smallest value.
3. Subtract MIN from MAX to get the range.
4. Example: =MAX(A1:A100) – MIN(A1:A100).
5. If a data set has an odd number of observations, the median:
A. Cannot be determined
B. Is the value of the middle item when all items are arranged in
ascending order
C. Is the average value of the two middle items when all items are arranged
in ascending order
D. Must be equal to the mean
Correct Answer: B. Is the value of the middle item when all items are
arranged in ascending order.
Rationale:
1. For odd n, median position = (n+1)/2.
2. Example: n=9 → (9+1)/2 = 5th observation.
3. No averaging is needed when n is odd.
4. The median is the 50th percentile.
6. Which of the following represents the data point that occurs most
frequently in a set of observations?
A. Mean
B. Mode
C. All of these choices are correct
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D. Median
Correct Answer: B. Mode.
Rationale:
1. Mode is the most frequently occurring value.
2. A data set may have no mode, one mode (unimodal), or multiple modes
(bimodal, multimodal).
3. Mode is the only measure of central tendency that can be used with
nominal data.
4. Mean and median are measures of center, not frequency.
7. The median of a data set is represented by the:
A. 50th percentile
B. 75th percentile
C. 100th percentile
D. 25th percentile
Correct Answer: A. 50th percentile.
Rationale:
1. The median divides the data into two equal halves.
2. 50% of observations fall below the median, 50% above.
3. The first quartile (Q1) is the 25th percentile.
4. The third quartile (Q3) is the 75th percentile.
8. Which of the following is a possible reason for an outlier in a data
set?
A. A mistake was made while taking a measurement or entering it into the
computer
B. The individual in question belongs to a different group than the bulk of
individuals measured
C. The outlier is a legitimate data value and represents natural variability
D. All of these choices are possible reasons for an outlier
Correct Answer: D. All of these choices are possible reasons for an outlier.
Rationale:
1. Outliers can result from measurement or data entry errors.
2. They may indicate a different population (e.g., a child in an adult study).
3. Some outliers are legitimate extreme values (e.g., high income earner).
4. Investigate outliers before deciding to include or exclude them.
QMB 3200 Test 1 | Business Statistics –
Descriptive Statistics & Probability |
Multiple Choice & Open-Ended Q&A |
Verified Answers
Exam Structure:
Subject: Business Statistics – Descriptive Statistics & Probability (QMB 3200)
Source: QMB 3200 Test 1 – Verified Answers
Format: Multiple Choice & Open-Ended Q&A
1. What is the z-score formula?
Correct Answer: (observation – mean) / standard deviation
Rationale:
1. The z-score measures how many standard deviations an observation is
from the mean.
2. A positive z-score indicates the observation is above the mean.
3. A negative z-score indicates the observation is below the mean.
4. Z-scores allow comparison of values from different distributions.
2. What does a z-score tell us?
Correct Answer: How many standard deviations a value is from the mean.
Rationale:
1. Z-scores standardize data, making it unit-free.
2. In a normal distribution, about 68% of data falls between z = -1 and z =
+1.
3. About 95% falls between z = -2 and z = +2.
4. About 99.7% falls between z = -3 and z = +3 (Empirical Rule).
, 2|Page
3. How do you find the range?
Correct Answer: Biggest value minus smallest value.
Rationale:
1. The range is the simplest measure of dispersion.
2. It is sensitive to outliers (extreme values).
3. Formula: Range = Maximum – Minimum.
4. Does not describe variability within the middle of the distribution.
4. What is the Excel formula to find the range?
Correct Answer: =MAX(array) – MIN(array)
Rationale:
1. MAX returns the largest value in the range.
2. MIN returns the smallest value.
3. Subtract MIN from MAX to get the range.
4. Example: =MAX(A1:A100) – MIN(A1:A100).
5. If a data set has an odd number of observations, the median:
A. Cannot be determined
B. Is the value of the middle item when all items are arranged in
ascending order
C. Is the average value of the two middle items when all items are arranged
in ascending order
D. Must be equal to the mean
Correct Answer: B. Is the value of the middle item when all items are
arranged in ascending order.
Rationale:
1. For odd n, median position = (n+1)/2.
2. Example: n=9 → (9+1)/2 = 5th observation.
3. No averaging is needed when n is odd.
4. The median is the 50th percentile.
6. Which of the following represents the data point that occurs most
frequently in a set of observations?
A. Mean
B. Mode
C. All of these choices are correct
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D. Median
Correct Answer: B. Mode.
Rationale:
1. Mode is the most frequently occurring value.
2. A data set may have no mode, one mode (unimodal), or multiple modes
(bimodal, multimodal).
3. Mode is the only measure of central tendency that can be used with
nominal data.
4. Mean and median are measures of center, not frequency.
7. The median of a data set is represented by the:
A. 50th percentile
B. 75th percentile
C. 100th percentile
D. 25th percentile
Correct Answer: A. 50th percentile.
Rationale:
1. The median divides the data into two equal halves.
2. 50% of observations fall below the median, 50% above.
3. The first quartile (Q1) is the 25th percentile.
4. The third quartile (Q3) is the 75th percentile.
8. Which of the following is a possible reason for an outlier in a data
set?
A. A mistake was made while taking a measurement or entering it into the
computer
B. The individual in question belongs to a different group than the bulk of
individuals measured
C. The outlier is a legitimate data value and represents natural variability
D. All of these choices are possible reasons for an outlier
Correct Answer: D. All of these choices are possible reasons for an outlier.
Rationale:
1. Outliers can result from measurement or data entry errors.
2. They may indicate a different population (e.g., a child in an adult study).
3. Some outliers are legitimate extreme values (e.g., high income earner).
4. Investigate outliers before deciding to include or exclude them.
