DSCI 5180: Introduction to the Business

Decision Process
Spring 2013 Dr. Nick Evangelopoulos

Exam 1 review:
Quizzes 1-6

slide 1

POP QUIZ #1
1. Probabilities under the Normal Distribution
are typically calculated:
A.
B.
C.
D.
E.

After standardization of the random variable

After applying reverse standardization
By asking experts to estimate it
Without the use of computers or calculators
Without looking at a Z table
2

POP QUIZ #1
2. The number that corresponds to a tail
probability of 5% is usually calculated:
A.
B.
C.
D.
E.

After standardization of the random variable

After applying reverse standardization
By asking experts to estimate it
Without the use of computers or calculators
Without looking at a Z table
3

POP QUIZ #1
3. In providing interval estimates for , the t
distribution applies:
A. When sample sizes are large (n > 30)
B. When sample sizes are small (n < 30),
regardless of the distribution of X
C. When the pop. st. deviation () is known
D. When the pop. st. deviation () in unknown
E. When the sample st. deviation (s) is unknown
4

POP QUIZ #1
4. P(z>1) and P(z< -1) are related as follows:
A.
B.
C.
D.

P(z>1) + P(z< -1) = 1

P(z>1) = P(z< -1)
P(z>1) = 0.5 - P(z< -1)
P(z>1) + P(z< -1) = 0.5

POP QUIZ #1
5. The probability that a consumer qualifies for
a tire warranty that promises 50K miles is
calculated as:
A. The tail probability P(x < 50K)
B. The tail probability P(x > 50K)
C. The middle probability P(50K < x < 60K)
D. The middle-half probability P(50K < x < 60K)

POP QUIZ #2
1. Which one of the variables listed you
expect to follow a Normal distribution:
A.
B.
C.
D.

Size of craters on planet Mars

Size of earthquakes
Duration of time delays
A persons height
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POP QUIZ #2
2. Which one of the variables listed you
expect to follow an Exponential
distribution:
A.
B.
C.
D.

Size of craters on planet Mars

A persons height
A persons weight
A persons intelligence (IQ)
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POP QUIZ #2
3. The Central Limit Theorem states that:
A. When sample sizes are large (n > 30), the
distribution of X-bar is approx. normal
B. When sample sizes are small (n < 30), the
distribution of X-bar is approx. normal
C. When the pop. st. deviation () is known, the
distribution of X-bar is approx. normal
D. When the pop. st. deviation () in unknown,
the distribution of X-bar is approx. normal 9

POP QUIZ #2
4. In statistical inference, when the sample
size increases:
A. The confidence interval remains the same
B. The confidence interval expands (=becomes
wider)
C. The confidence interval shrinks (=becomes
narrower)
D. The standard deviation of x-bar increases
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POP QUIZ #2
5. In hypothesis testing, the null hypothesis is
rejected when:
A.
B.
C.
D.

P-value > alpha

P-value < alpha
Alpha < critical value
Alpha > critical value
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POP QUIZ #3
1. The fitted regression line is typically
calculated by minimizing the sum of:
A.
B.
C.
D.
E.

The squared Y values

The squared residuals
The absolute residuals
The residuals
The Y values
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POP QUIZ #3
2. In the fitted line equation for housing starts,
STARTS = 1726 22.2 RATE, the number 22.2 is
called:
A.
B.
C.
D.
E.

The Y-intercept
The residual
The predictor variable
The response variable
The slope coefficient

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POP QUIZ #3
3. In the fitted line equation for housing starts,
STARTS = 1726 22.2 RATE, 22.2 represents:
A.
B.
C.
D.
E.

The decrease in starts for each unit rate increase

The increase in starts for each unit rate increase
The starts when rate is equal to zero
The rate when the starts are equal to zero
The rate when the starts are equal to 1726
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POP QUIZ #3
4. MSE is used as an estimator for:
A.
B.
C.
D.
E.

The regression slope

The y-intercept
The mean of the disturbance (error)
The variance of the disturbance (error)
The st. deviation of the disturbance (error)
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POP QUIZ #3
5. As part of regression analysis, why do we
want to test whether or not 1 = 0?
A. It is the way to see if the y-intercept is zero
B. It is the way to see if the assumptions hold
C. It is the way to see if X and Y are linearly
related
D. It is the way to see if X is the only possible
predictor for Y
E. It is the way to see if the t distribution holds
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POP QUIZ #4
1. The relationship between COST and
NUMPORTS is significant if:
A. The R-squared has a high value
B. The value of the t statistic for 0 is close to 0
C. The p-value for 0 is close to 0
D. The value of the t statistic for 1 is close to 0
E. The p-value for 1 is close to 0
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POP QUIZ #4
2. Based on the regression output below,
Predictor
Constant
NUMPORTS

A.
B.
C.
D.
E.

Coef
16594
650.17

SE Coef
2687
66.91

T
6.18
9.72

P
0.000
0.000

The constant is probably equal to 0

The slope for NUMPORTS is probably zero
The slope for NUMPORTS is significant
The t test for the slope is not significant
The t test for the constant is not significant

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POP QUIZ #4
3. Testing the slope of NUMPORTS for
significance, the degrees of freedom are :
A.
B.
C.
D.
E.

n-2
n-1
n
Always equal to zero
Equal to 30
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POP QUIZ #4
4. A 95% C.I. for a regression slope is
always:
A. Symmetrical around b0
B.
C.
D.
E.

Symmetrical around b1
Calculated using the F distribution
Calculated using the z distribution
Non-symmetrical
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POP QUIZ #4
5. To test whether a relationship between X and
Y is positive, we need to test:
A. H0: 0 = 0 vs. Ha: 0 > 0
B. H0: 1 = 0 vs. Ha: 1 < 0
C. H0: 1 = 0 vs. Ha: 1 > 0
D. H0: 1 = 0 vs. Ha: 1 0
E. H0: 0 = 0 vs. Ha: 0 0
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POP QUIZ #5
1. Referring to the ANOVA table, SST is
given as:
A.
B.
C.
D.
E.

SST = SSR - SSE

SST = SSR
SST = SSE
SST = SSR + SSE
SST = SSR / SSE
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POP QUIZ #5
2. The Coefficient of Determination is
computed as:
A.
B.

C.
D.
E.

R = SSR / SST
R = SSR / SSE
R2 = SSR / SST
R2 = SST / SSR
R2 = SST / SSE
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POP QUIZ #5
3. The Regression F test is designed to examine :
A. Whether or not 1 = 0
B. Whether or not 0 = 0
C. Whether or not 1 = 0 = 0
D. Whether or not 1 = 1
E. Whether or not 0 = 1

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POP QUIZ #5
4. In simple regression, is it always necessary
to conduct an F test?
A. Yes, the information provided by an F test is
unique
B. Yes, the F test may contradict one of the t tests
C. No, it is the same as doing t tests for 0 and 1
D. No, it is the same as doing a t test for 0
E. No, it is the same as doing a t test for 1
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POP QUIZ #5
5. Refer to the communication nodes example. Is Nodes
a significant predictor for Cost? (ANOVA table given below)
Source
Regression
Residual Error
Total

A.
B.
C.
D.
E.

DF
1
12
13

SS
1751268376
222594146
1973862521

MS
1751268376
18549512

F
94.41

Yes, because the F value is less than 0.05

Yes, because the p value is less than 0.05
No, because the F value is very large
No, because the p value is very small
No, because the F value is larger than the p value

P
0.000

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POP QUIZ #6
1. The regression model assumptions refer to:
A.
B.
C.
D.

The errors
The y-intercept
The slope coefficients
All coefficients, including y-intercept and
slopes
E. The degrees of freedom
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POP QUIZ #6
2. Analysis of Meddicorp Sales produced the
fitted line listed below. How do you
interpret the slope for Bonus?
SALES = - 516 + 2.47 ADV + 1.86 BONUS

A. Each $1 of Bonus increases Sales by $1.86

B. Each $100 of Bonus increases Sales by

$1,860, if Adv is kept constant
C. Each $100 of Bonus increases Sales by $186
D. Each $1 in Sales increases Bonus by $1.86
E. Each $1.86 in Sales increases Bonus by $1
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POP QUIZ #6
3. Based on the regression output below,
Predictor
Constant
ADV
BONUS

A.
B.
C.
D.
E.

Coef
-516.4
2.4732
1.8562

SE Coef
189.9
0.2753
0.7157

T
-2.72
8.98
2.59

P
0.013
0.000
0.017

Only ADV is a significant predictor for Sales

Only Bonus is a significant predictor for Sales
Both ADV and Bonus are significant predictors for Sales
Neither ADV nor Bonus are significant predictors for Sales
The constant is negative, therefore there is an inverse
relationship between Sales and ADV or Bonus
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POP QUIZ #6
4. The Multiple Regression F test is designed to
examine:
A. Whether or not 1 = 0
B. Whether or not 0 = 0
C. Whether or not 0 = 1 = 0
D. Whether or not 0 = 1 = = 0

E. Whether or not = = = 0
1
2
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POP QUIZ #6
5. When you remove an explanatory variable from a
regression model,
A. R2 will always increase, but R2 adjusted may decrease
B. R2 will always decrease, but R2 adjusted may increase
C. R2 will always increase, but R2 adjusted may or may not
increase
D. Both R2 and R2 adjusted will always increase
E. Both R2 and R2 adjusted will always decrease

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