Professional Documents
Culture Documents
The New Zealand Department of Labour regularly collects data on employment in New
Zealand. The following table is based on the regional labour market summary, July 2003 – June
2004.
Auditors developing systems to check the accuracy of regular tax returns for such taxes as GST
look at changes in the firms returns between tax periods. If the change is greater than some
threshold the firm’s return is tagged to be subject to rigorous audit. To check the accuracy of one
such system a large sample of returns were all audited. It was found that 23% of returns tagged
for audit by the system revealed tax evasion while only 1 out of 200 returns that were not tagged
for audit by the system revealed tax evasion.
The system was implemented at a tax department and run on a sample of 10,000 tax returns. Of
these, 600 were tagged for audit.
(a) (i) How many of the 600 returns tagged are estimated to be for firms trying to evade tax?
(ii) How many of the remaining returns are estimated to be for firms trying to evade tax?
(b) Use your answer from (a) to help construct a 2×2 table of counts displaying the results for this
sample. Complete the table.
(c) What is the estimated number of tax returns in this sample where the firm is trying to evade tax?
(d) What is the estimated proportion of firms that are trying to evade tax which have their return
tagged for audit?
(b) Can we calculate the probability that a randomly selected sample of 48 valves has a mean of
less than 12.6g of nickel? If you can, then calculate the probability (showing any working). If
you can’t calculate it, then explain why you can’t.
Question 1: Which one of the following Question 2: Have you given someone a gift
would you most like as a surprise gift? that you had received as a gift?
Answer Male Female Total All respondents: Yes (84) No (316)
Clothing 24 10 34
Tools 36 13 49 Question 3: Do you like Christmas shopping?
Book 37 41 78 Male respondents: Yes (41) No (151)
Jewellery 4 56 60
CD 17 10 27 Female respondents: Yes (74) No (134)
Perfume 5 22 27 Question 4: Are you going to give presents to
Cash 39 31 70 someone this Christmas?
Other 30 25 55
All respondents: Yes (370) No (30)
Total 192 208 400
(a) State the sampling situation for calculating the standard error of the difference in:
(i) estimating the difference between the proportion of New Zealanders that have given
someone a gift that they had received as a gift and the proportion of New Zealanders that
are going to give presents to someone this Christmas.
(ii) estimating the difference between the proportion of New Zealanders that would most like
jewellery as a surprise gift and the proportion of New Zealanders that would most like
cash as a surprise gift.
(iii) estimating the difference between the proportion of New Zealand males that would most
like clothing as a surprise gift and the proportion of New Zealand females that would most
like clothing as a surprise gift.
(b) By hand, calculate a 95% confidence interval for the difference between the proportion of New
Zealand males that like Christmas shopping and the proportion of New Zealand females that
like Christmas shopping.