Midterm1CheatSheet - 1 Which time-series component is said...

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1. Which time-series component is said to fluctuate around the long-term trend and is fairly irregular in appearance? A) Trend. B) Cyclical . C) Seasonal. D) Irregular. E) None. 2. Which measure of dispersion in a data set is the most intuitive and represents an average? A) Range. B) Mode. C) Standard deviation . D) Mean. 3. Based upon ten years of monthly data, the monthly rate of return of the DOW Jones 30 composite stock portfolio was normally distributed with mean .0084 and variance .0014. What is the probability, that in any given month, we observe a rate of return on the DOW above 10 percent? A) Less than one percent . B) Two percent. C) Three percent. 4. The sampling distribution of the sample mean, when sampling from a normal population with mean μ and variance σ 2 is: A) normally distributed with mean μ and variance σ 2. B) normally distributed with mean μ and variance s 2. C) normally distributed with mean μ and variance σ 2/n . D) normally distributed with mean 0 and variance 1. 5. Which probability distribution is appropriate for testing hypotheses concerning an unknown population mean when the sample variance is used to estimate the population variance? A) The normal distribution with mean μ and variance σ 2. B) The normal distribution with mean 0 and variance 1. C) The standard normal distribution. D) The t distribution with n-1 degrees of freedom . 6. A random sample of bolts is taken from inventory and their length is measured. The average length in the sample is 5.3 inches, with a standard deviation of .2 inches. The sample size was 50. The point estimate for the mean length of all bolts in inventory is: A) 5.3 inches . B) 2 inches. C) 4.908 to 5.692 inches. D) 5.3 inches plus or minus .2 7. In the previous question, a 95% confidence interval for the unknown population mean is closest to: A) 5.3 inches. B) 4.9 to 5.7 inches. C) 5.3 inches plus or minus .056 . D) 4.784 to 5.816 inches. E) None of the above 8. When the correlation coefficient is negative, it means: A) there is a weak relationship. B) when X goes down, Y does too. C) X will not be a good predictor of Y. D) when X goes down, Y tends to go up . E) None of the above. 9. A simple-centered 3-point moving average of the time-series variable Xt is given by: A) (Xt-1+ Xt-2+ Xt-3)/3. B) (Xt+ Xt-1+ Xt-2)/3. C) (Xt+1+ Xt+ Xt-1)/3. D) None of the above. 10. The term 'exponential' in the exponential smoothing method refers to A) weights on past data that increase exponentially into the past. B) weights on past data that decrease exponentially into the past. C) calculation uses a weighted average. D) using a non- weighted polynomial on past data. E) None of the above. 11. If the smoothing constant were chosen to be unity, the exponential smoothing model would equal A) moving average smoothing. B) Holt's exponential smoothing. C) the simple naive model. D) Winter's exponential smoothing. E) moving average smoothing with a one-year lag.
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