MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

The HP company operates service centers in various locations in the US and abroad where customers can call to get answers to questions about HP products. Previous studies indicate that the distribution of time required for each call is normally distributed. with a mean equal to 540 seconds. Company ofcials have selected a random sample of 16 calls and wish to determine whether the mean call time has decreased after a training program was given to call center employees 1) The appropriate hypotheses to test are: A) Ho: =540 vs Ha: <540 B) Ho: =540 vs Ha: >540 C) Ho: >540 vs Ha: 560 D) Ho: <540 vs Ha: 540 E) none of the above 2) In the random sample of 16 calls, the ofcials found that the sample mean was 510 seconds and the sample standard deviation was 45 seconds. If they use a 1% level of signicance, then A) pvalue>0.01 B) pvalue=0.0038 C) pvalue>0.05 D) pvalue>0.025 E) 0.005<pvalue<0.01 3) In the random sample of 16 calls, the ofcials found that the sample mean was 510 seconds and the sample standard deviation was 45 seconds. If they use a 1% level of signicance, what decision should they make? A) The ofcial cannot make a decision based on the information given B) Reject Ho C) Accept Ho D) Fail to reject Ho E) None of the above The Northwest Pacic Phone Company wishes to estimate the average number of minutes its customers spend on long-distance calls. A simple random sample of 25 customers' records yielded a sample mean and a standard deviation for long-distance calls equal to 100 minutes and 30 minutes, respectively. 4) A 98% condence interval for the mean for the long-distance calls of all customres is given by A) 1002.492*30 B) 1002.492*6.124 C) 1002.485*6.124 D) 1002.485*6 E) 1002.492*6 5) How large a sample must be taken to be 99% condent that the estimate of the average time of long -distance calls is within 5 minutes of the true average time of long-distance calls of all customers? A previous study indicated that the standard deviation for long-distance calls is 30 minutes. A) 60 B) 239 C) 150 D) 200 E) none of the above

Data were collected for a sample of 12 pharmacists to determine if years of experience and salary are related. Below is the partial regression analysis results. The dependent variable is Salary in thousands of dollars.
Variable (Intercept) Years Experience R-squared=81% Estimate 37.164 1.49 Std.Err. 3.381 0.215

6) The calculated t-statistic to test whether the regression slope is signicant is A) 6.93. B) 10.99. C) 5.58485. D) 47.97. 7) At the 0.05 level of signicance, testing whether the regression slope is signicant I. we reject the null hypothesis. II. we do not reject the null hypothesis. III. we conclude that years of experience is signicant in explaining pharmacists' salary. A) II only B) I only C) II and III D) III only

E) 31.2.

E) I and III

8) Using the estimated regression to predict salary for 10 years of experience gives the following results.
95% CI (48.01, 56.08) 95% PI (38.96, 65.13)

Which of the following is true? A) 95% of pharmacists with 10 years of experience earn between $38,960 and $65,130. B) We are 95% condent that a particular pharmacist who has 10 years of experience earns between $38,960 and $65,130. C) We are 95% condent that a particular pharmacist who has 10 years of experience earns between $48,010 and $56,080. D) 95% of pharmacists with 10 years experience on average earn between $48,010 and $56,080. E) 95% of pharmacists with 10 years of experience earn between $48,010 and $56,080. 9) The correlation coefcient between Years of experience and Salary is A) -0.9 B) It can't be found from the information given. C) 0.9 D) 0.7 E) 0.81 10) Which of the following is not an assumption or condition that needs to be checked for a two-sample t-test for the difference between two means? A) Randomization B) 10% Condition C) Independent Groups D) Nearly Normal Condition E) All of the above must be checked

A consumer group was interested in comparing the operating time of cordless toothbrushes manufactured by two different companies. Group members took a random sample of 16 toothbrushes from Company A and 11 from Company B. Each was charged overnight and the number of minutes of use before needing to be recharged was recorded. Company A toothbrushes operated for an average of 119 minutes with a standard deviation of 1.7 minutes; Company B toothbrushes operated for an average of 120 minutes with a standard deviation of 1.5 minutes. Assuming that the operating times of cordless toothbrushes manufactured by the two companies are normally distributed with equal variances, do the data indicate that Company B toothbrushes operate more minutes on average than Company A toothbrushes?

11) The correct null and alternative hypotheses (assuming 1 stands for company A and 2 for company B) are A) H0: 1 - 2 > 0 and HA: 1 - 2 < 0. B) H0: 1 - 2 = 0 and HA: 1 - 2 < 0. C) H0: 1 - 2 = 0 and HA: 1 - 2 0. D) H0: 1 - 2 = 0 and HA: 1 - 2 > 0. E) None of the above 12) The value of the test statistics is closest to A) -1.57 B) 1.61

C) -0.149

D) 0.149

E) 1.57

13) The rejection region for this test at 5% level of signicance is A) Reject Ho if test statistics>2.060 B) Reject Ho if test statistics<-1.708 C) Reject Ho if test statistics>1.708 D) Reject Ho if test statistics<-2.060 E) Reject Ho if test statistics<-1.812 14) At = 0.05, I. we reject the null hypothesis. II. we fail to reject the null hypothesis. III. we can conclude that Company B toothbrushes operate more minutes on average than Company A toothbrushes. A) I and III B) I only C) II only D) III only E) II and III 15) An urban planning group is interested in estimating the difference in mean household income between two neighborhoods. They obtain the following 95% condence interval:
95% CI for difference: (-5693, -4107).

Which of the following is true? I. This is a paired design. II. There is no signicant difference in the mean household incomes between the two neighborhoods. III. There is a signicant difference in the mean household incomes between the two neighborhoods. A) III only B) I and II C) I and III D) I only E) II only

The following is a partial output from regression analysis performed to develop a model for predicting a rm's Price-Earnings Ratio (PE) based on Growth Rate and Prot Margin .There are 15 observations for each variable.
Variable (Intercept) Growth Rate Profit Margin Estimate 7.401 0.948 0.056 Std.Err 1.896 0.1396 0.0395 Tstat 3.90 6.79 1.42 P-value 0.002 0.000 0.180

Analysis of Variance Model (Regression) Error (Residual) Total DF SS 91.94 114.65 MS F-stat P-value 0.000

16) At = 0.05 we can conclude that A) Prot Margin is a signicant variable in predicting a rm's PE ratio. B) the regression coefcient associated with Prot Margin is signicantly different from zero. C) the regression coefcient associated with Growth Rate is not signicantly different from zero. D) the regression coefcient associated with Growth Rate is signicantly different from zero. E) Growth Rate is not a signicant variable in predicting a rm's PE ratio. 17) Which of the following is the correct interpretation for the regression coefcient of Growth Rate? A) Given the same prot margin, the PE ratio of a rm will be 0.948 points lower, on average, for each percentage point increase in Growth Rate. B) The regression coefcient is not signicantly different from zero. C) The regression coefcient indicates that the PE ratio of a rm that with a higher growth rate will, on average, be 0.948 points times higher than a rm with a lower growth rate. D) The regression coefcient indicates that the PE ratio of a rm that with a higher growth rate will, on average, be 0.948 points times lower than a rm with a lower growth rate. E) Given the same prot margin, the PE ratio of a rm will be 0.948 points higher, on average, for each percentage point increase in Growth Rate. 18) The F-statistics value is closest to A) 26.31 B) 29.23 C) 24.29 D) It can't be calculated from the information given. E) 20.5 19) Based on the Analysis of Variance, we can conclude at = 0.05 that A) at least one of the independent variables is statistically signicant in explaining variation in the dependent variable B) none of the independent variables in the model are signicant. C) all independent variables in the model are signicant. D) the regression equation is not signicant. E) all independent variables in the model are signicant and the regression equation is signicant.

20) A 95% condence interval for the coefcient of Prot Margin is A) (-0.1355, 0.0235) B) (-0.03, 0.142) C) (-0.142, 0.03) D) (-0.0235, 0.1355) E) (0.029, 0.141) 21) How much of the variability in the PE ratio is accounted for by the regression model? A) 80.2% B) It can't be found from the information given. C) 68.6% D) 75.5% E) 19.8% 22) The standard error about the regression line is equal to A) 6.78 B) 1.3757 C) 1.8925

D) 1.3217

E) 1.6425

A shipping company believes that the variation in the cost of the customer's shipping can be explained by differences in the weight of the package being shipped. To investigate whether this relationship is useful, a random sample of 10 customer shipments was selected and the weight (in lb) and the cost (in dollars) for each shippment was recorded. The following statistics were computed from the sample. If y-response, and x-predictor then x=105, y=145, r=0.90, SD(x)=4, SD(y)=6 23) The coefcient estimates of the regression line for the slope and y-intercept are respectively A) 1.35 and 0.325 B) 0.6 and 8.2 C) -1.35 and -0.325 D) 1.35 and -9.075 E) 2.35 and -6.175 24) The rst observation in the random sample has weight equal to 10 lbs and cost equal to 12 $. What is the residual for this observation? A) 4.425 B) -2.2 C) -1.825 D) -4.425 E) 1.825 25) The standard error about the regression line is equal to 3. What is a 95% condence interval for the slope of the regression line? A) (-3.0795, 0.3795) B) (0.793, 1.907) C) (-0.3795, 3.0795) D) (0.0235, 1.1765) E) (0.7735, 1.9265) 26) If the weights of two packages differ by 4 lbs then by how much will their estimated costs differ? A) $2.4 B) $1.35 C) $9.4 D) $5.4 E) None of the above

To test the effectiveness of a business school preparation course, 9 students took a general business test before and after the course. The summaries are given below (out of 1000 points). Test Mean Std. Dev. Before 693.75 155.37 After 743.75 143.92 After- Before 50 65 27) Which of the following statements is true A) This is a two-tail test B) This is paired design and a one-tail test C) This is paired design and a two-tail test D) This is a test of two means from independent samples E) None of the above 28) At the 5% level of signicance, the correct conclusion is I. reject the null hypothesis. II. fail to reject the nul hypothesis. III. The effectiveness of the test is supported by the sample evidence. A) II only B) III only C) II and III

D) I and III

E) I only

29) A brokerage rm is interested in nding out whether more men than women trade stocks online. Based on random samples of men and women they nd that a 95% condence interval for the difference in the proportions of men and women who trade stock online is (-2%, 6%). Based on this condence interval they can conclude A) that a signicant difference exists in the proportions of men and women who trade stocks online. B) that more men than women trade stock online. C) that more women than men trade stock online. D) that there is no signicant difference in the proportions of men and women who trade stocks online. E) nothing, because we can't draw conclusions from condence intervals. 30) A least squares estimated regression line has been tted to a set of data and the resulting residual plot is shown. Which is true?

A) The linear model is poor because the correlation is near zero. B) The linear model is poor because some residuals are large. C) The error terms are not normally distributed. D) A transformation of the data is required because the scatterplot looks curved. E) None of the above

Answer Key Testname: PRACFIN

1) A 2) E 3) B 4) E 5) B 6) A 7) E 8) B 9) C 10) E 11) B 12) A 13) B 14) C 15) A 16) D 17) E 18) C 19) A 20) B 21) A 22) B 23) A 24) C 25) E 26) D 27) B 28) D 29) D 30) E