Chapter 11

Basic Statistics for Business and Economics with Student · 25 exercises

Problem 1

A sample of 40 observations is selected from one population with a population standard deviation of \(5 .\) The sample mean is \(102 .\) A sample of 50 observations is selected from a second population with a population standard deviation of \(6 .\) The sample mean is \(99 .\) Conduct the following test of hypothesis using the .04 significance level. $$ \begin{array}{l} H_{0}: \mu_{1}=\mu_{2} \\ H_{1}: \mu_{1} \neq \mu_{2} \end{array} $$ a. Is this a one-tailed or a two-tailed test? b. State the decision rule. c. Compute the value of the test statistic. d. What is your decision regarding \(H_{0}\) e. What is the \(p\) -value?

5 step solution

Problem 2

A sample of 65 observations is selected from one population with a population standard deviation of \(0.75 .\) The sample mean is \(2.67 .\) A sample of 50 observations is selected from a second population with a population standard deviation of \(0.66 .\) The sample mean is \(2.59 .\) Conduct the following test of hypothesis using the .08 significance level. $$ \begin{array}{l} H_{0}: \mu_{1} \leq \mu_{2} \\ H_{1}: \mu_{1} > \mu_{2} \end{array} $$ a. Is this a one-tailed or a two-tailed test? b. State the decision rule. c. Compute the value of the test statistic. d. What is your decision regarding \(H_{0} ?\) e. What is the \(p\) -value?

5 step solution

Problem 3

Gibbs Baby Food Company wishes to compare the weight gain of infants using its brand versus its competitor's. A sample of 40 babies using the Gibbs products revealed a mean weight gain of 7.6 pounds in the first three months after birth. For the Gibbs brand the population standard deviation of the sample is 2.3 pounds. A sample of 55 babies using the competitor's brand revealed a mean increase in weight of 8.1 pounds. The population standard deviation is 2.9 pounds. At the .05 significance level, can we conclude that babies using the Gibbs brand gained less weight? Compute the \(p\) value and interpret it.

5 step solution

Problem 4

As part of a study of corporate employees, the director of human resources for PNC, Inc., wants to compare the distance traveled to work by employees at its office in downtown Cincinnati with the distance for those in downtown Pittsburgh. A sample of 35 Cincinnati employees showed they travel a mean of 370 miles per month. A sample of 40 Pittsburgh employees showed they travel a mean of 380 miles per month. The population standard deviations for the Cincinnati and Pittsburgh employees are 30 and 26 miles, respectively. At the .05 significance level, is there a difference in the mean number of miles traveled per month between Cincinnati and Pittsburgh employees?

6 step solution

Problem 5

A financial analyst wants to compare the turnover rates, in percent, for shares of oil-related stocks versus other stocks, such as GE and IBM. She selected 32 oil-related stocks and 49 other stocks. The mean turnover rate of oil-related stocks is 31.4 percent and the population standard deviation 5.1 percent. For the other stocks, the mean rate was computed to be 34.9 percent and the population standard deviation 6.7 percent. Is there a significant difference in the turnover rates of the two types of stock? Use the .01 significance level.

6 step solution

Problem 6

Mary Jo Fitzpatrick is the vice president for Nursing Services at St. Luke's Memorial Hospital. Recently she noticed in the job postings for nurses that those that are unionized seem to offer higher wages. She decided to investigate and gathered the following information. $$ \begin{array}{|lccc|} \hline & & \text { Population } & \\ \text { Group } & \text { Mean Wage } & \text { Standard Deviation } & \text { Sample Size } \\ \hline \text { Union } & \$ 20.75 & \$ 2.25 & 40 \\ \text { Nonunion } & \$ 19.80 & \$ 1.90 & 45 \\ \hline \end{array} $$ Would it be reasonable for her to conclude that union nurses earn more? Use the .02 significance level. What is the \(p\) -value?

7 step solution

Problem 7

The null and alternate hypotheses are: $$ \begin{array}{l} H_{0}: \pi_{1} \leq \pi_{2} \\ H_{1}: \pi_{1}>\pi_{2} \end{array} $$ A sample of 100 observations from the first population indicated that \(X_{1}\) is \(70 .\) A sample of 150 observations from the second population revealed \(X_{2}\) to be \(90 .\) Use the .05 significance level to test the hypothesis. a. State the decision rule. b. Compute the pooled proportion. c. Compute the value of the test statistic. d. What is your decision regarding the null hypothesis? e. The null and alternate hypotheses are: $$ \begin{array}{l} H_{0}: \pi_{1}=\pi_{2} \\ H_{1}: \pi_{1} \neq \pi_{2} \end{array} $$

5 step solution

Problem 9

The Damon family owns a large grape vineyard in western New York along Lake Erie. The grapevines must be sprayed at the beginning of the growing season to protect against various insects and diseases. Two new insecticides have just been marketed: Pernod 5 and Action. To test their effectiveness, three long rows were selected and sprayed with Pernod \(5,\) and three others were sprayed with Action. When the grapes ripened, 400 of the vines treated with Pernod 5 were checked for infestation. Likewise, a sample of 400 vines sprayed with Action were checked. The results are: At the .05 significance level, can we conclude that there is a difference in the proportion of vines infested using Pernod 5 as opposed to Action?

7 step solution

Problem 10

The Roper Organization conducted identical surveys 5 years apart. One question asked of women was "Are most men basically kind, gentle, and thoughtful?" The earlier survey revealed that, of the 3,000 women surveyed, 2,010 said that they were. The later revealed 1,530 of the 3,000 women surveyed thought that men were kind, gentle, and thoughtful. At the .05 level, can we conclude that women think men are less kind, gentle, and thoughtful in the later survey compared with the earlier one?

5 step solution

Problem 11

A nationwide sample of influential Republicans and Democrats was asked as a part of a comprehensive survey whether they favored lowering environmental standards so that high-sulfur coal could be burned in coal-fired power plants. The results were: $$ \begin{array}{|lcc|} \hline & \text { Republicans } & \text { Democrats } \\ \hline \text { Number sampled } & 1,000 & 800 \\ \text { Number in favor } & 200 & 168 \end{array} $$ At the .02 level of significance, can we conclude that there is a larger proportion of Democrats in favor of lowering the standards? Determine the \(p\) -value.

7 step solution

Problem 12

The research department at the home office of New Hampshire Insurance conducts ongoing research on the causes of automobile accidents, the characteristics of the drivers, and so on. A random sample of 400 policies written on single persons revealed 120 had at least one accident in the previous three-year period. Similarly, a sample of 600 policies written on married persons revealed that 150 had been in at least one accident. At the .05 significance level, is there a significant difference in the proportions of single and married persons having an accident during a three-year period? Determine the \(p\) -value.

7 step solution

Problem 13

(a) state the decision rule, (b) compute the pooled estimate of the population variance, (c) compute the test statistic, (d) state your decision about the null hypothesis, and (e) estimate the \(p\) -value. The null and alternate hypotheses are: $$ \begin{array}{l} H_{0}: \mu_{1}=\mu_{2} \\ H_{1}: \mu_{1} \neq \mu_{2} \end{array} $$ A random sample of 10 observations from one population revealed a sample mean of 23 and a sample deviation of \(4 .\) A random sample of 8 observations from another population revealed a sample mean of 26 and a sample standard deviation of \(5 .\) At the .05 significance level, is there a difference between the population means?

5 step solution

Problem 14

(a) state the decision rule, (b) compute the pooled estimate of the population variance, (c) compute the test statistic, (d) state your decision about the null hypothesis, and (e) estimate the \(p\) -value. The null and alternate hypotheses are: $$ \begin{array}{l} H_{0}: \mu_{1}=\mu_{2} \\ H_{1}: \mu_{1} \neq \mu_{2} \end{array} $$ A random sample of 15 observations from the first population revealed a sample mean of 350 and a sample standard deviation of \(12 .\) A random sample of 17 observations from the second population revealed a sample mean of 342 and a sample standard deviation of \(15 .\) At the .10 significance level, is there a difference in the population means?

5 step solution

Problem 16

A recent study compared the time spent together by single- and dual-earner couples. According to the records kept by the wives during the study, the mean amount of time spent together watching television among the single-earner couples was 61 minutes per day, with a standard deviation of 15.5 minutes. For the dual-earner couples, the mean number of minutes spent watching television was 48.4 minutes, with a standard deviation of 18.1 minutes. At the .01 significance level, can we conclude that the single-earner couples on average spend more time watching television together? There were 15 single-earner and 12 dual-earner couples studied.

6 step solution

Problem 20

The null and alternate hypotheses are: $$ \begin{array}{l} H_{0}: \mu_{d}=0 \\ H_{1}: \mu_{d} \neq 0 \end{array} $$ The following paired observations show the number of traffic citations given for speeding by Officer Dhondt and Officer Meredith of the South Carolina Highway Patrol for the last five months. At the . 05 significance level, is there a difference in the mean number of citations given by the two officers?

6 step solution

Problem 24

Clark Heter is an industrial engineer at Lyons Products. He would like to determine whether there are more units produced on the night shift than on the day shift. Assume the population standard deviation for the number of units produced on the day shift is 21 and is 28 on the night shift. A sample of 54 day-shift workers showed that the mean number of units produced was 345\. A sample of 60 night-shift workers showed that the mean number of units produced was \(351 .\) At the .05 significance level, is the number of units produced on the night shift larger?

2 step solution

Problem 25

Fry Brothers Heating and Air Conditioning, Inc. employs Larry Clark and George Murnen to make service calls to repair furnaces and air conditioning units in homes. Tom Fry, the owner, would like to know whether there is a difference in the mean number of service calls they make per day. Assume the population standard deviation for Larry Clark is 1.05 calls per day and 1.23 calls per day for George Murnen. A random sample of 40 days last year showed that Larry Clark made an average of 4.77 calls per day. For a sample of 50 days George Murnen made an average of 5.02 calls per day. At the .05 significance level, is there a difference in the mean number of calls per day between the two employees? What is the \(p\) -value?

6 step solution

Problem 26

A coffee manufacturer is interested in whether the mean daily consumption of regular-coffee drinkers is less than that of decaffeinated-coffee drinkers. Assume the population standard deviation for those drinking regular coffee is 1.20 cups per day and 1.36 cups per day for those drinking decaffeinated coffee. A random sample of 50 regular-coffee drinkers showed a mean of 4.35 cups per day. A sample of 40 decaffeinated-coffee drinkers showed a mean of 5.84 cups per day. Use the .01 significance level. Compute the \(p\) -value.

6 step solution

Problem 27

Suppose the manufacturer of Advil, a common headache remedy, recently developed a new formulation of the drug that is claimed to be more effective. To evaluate the new drug, a sample of 200 current users is asked to try it. After a one-month trial, 180 indicated the new drug was more effective in relieving a headache. At the same time a sample of 300 current Advil users is given the current drug but told it is the new formulation. From this group, 261 said it was an improvement. At the .05 significance level can we conclude that the new drug is more effective?

6 step solution

Problem 28

Each month the National Association of Purchasing Managers publishes the NAPM index. One of the questions asked on the survey to purchasing agents is: Do you think the economy is expanding? Last month, of the 300 responses, 160 answered yes to the question. This month, 170 of the 290 responses indicated they felt the economy was expanding. At the .05 significance level, can we conclude that a larger proportion of the agents believe the economy is expanding this month?

6 step solution

Problem 29

As part of a recent survey among dual-wage-earner couples, an industrial psychologist found that 990 men out of the 1,500 surveyed believed the division of household duties was fair. A sample of 1,600 women found 970 believed the division of household duties was fair. At the .01 significance level, is it reasonable to conclude that the proportion of men who believe the division of household duties is fair is larger? What is the \(p\) -value?

5 step solution

Problem 30

There are two major Internet providers in the Colorado Springs, Colorado, area, one called HTC and the other Mountain Communications. We want to investigate whether there is a difference in the proportion of times a customer is able to access the Internet. During a oneweek period, 500 calls were placed at random times throughout the day and night to HTC. A connection was made to the Internet on 450 occasions. A similar oneweek study with Mountain Communications showed the Internet to be available on 352 of 400 trials. At the .01 significance level, is there a difference in the percent of time that access to the Internet is successful?

6 step solution

Problem 31

In a poll recently conducted at Iowa State University, 68 out of 98 male students and 45 out of 85 female students expressed "at least some support" for implementing an "exit strategy" from Iraq. Test at the .05 significance level the null hypothesis that the population proportions are equal against the two-tailed alternative.

6 step solution

Problem 32

A study was conducted to determine if there was a difference in the humor content in British and American trade magazine advertisements. In an independent random sample of 270 American trade magazine advertisements, 56 were humorous. An independent random sample of 203 British trade magazines contained 52 humorous ads. Does this data provide evidence at the .05 significance level that there is a difference in the proportion of humorous ads in British versus American trade magazines?

6 step solution

Problem 37

Fairfield Homes is developing two parcels near Pigeon Fork, Tennessee. In order to test different advertising approaches, it uses different media to reach potential buyers. The mean annual family income for 15 people making inquiries at the first development is \(\$ 150,000\) with a standard deviation of \(\$ 40,000\). A corresponding sample of 25 people at the second development had a mean of \(\$ 180,000,\) with a standard deviation of \(\$ 30,000\). Assume the population standard deviations are the same. At the .05 significance level, can Fairfield conclude that the population means are different?

7 step solution

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