sample exam 2 key

# sample exam 2 key - First 5 letters of your last name Last...

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1. (3) Which of the following is not true about the Student’s t - distribution? It is used to construct confidence intervals for the population mean when the population standard deviation is known 2. (2) If you were constructing a 99% confidence interval of the population mean based on a sample of n = 25 where the standard deviation of the sample s = 0.05, the critical value of t will be t .005,24 = 2.797 3. (3) A manger of a small company would like to determine whether the average monthly balance of credit card holders is equal to \$120. An auditor selects a random sample of 100 accounts and finds that the average owed is \$128.7 with a sample standard deviation of \$26.9. If you wanted to test whether the auditor should conclude that there is evidence that the average balance is different from \$120, which test would you use? t -test of population mean 4. (8) After a financial analysis, the general manager of a large company decided that if more than 8% of potential buyers of a new product purchase that product, the company would show a profit. A hypothesis test is designed using α = 0.05 and n = 100 for the following hypotheses: H 0 : p 0.08 vs. H 1 : p > 0.08. What is the probability that 10% of potential buyers would actually purchase the product, but the test results in the conclusion that the product will not be profitable? Step 1: Definition of what you need to find: β = P(DNR H 0 / H 1 is true) Step 2: Find the Decision Rule: Reject H0 0.05 = 0.08 + 1.645 p ˆ c p ˆ 100 ) 92 . 0 ( 08 . 0 = 0.1246 0.08 = .1246 c p ˆ Step 3: Rewrite the definition from Step 1 in terms of your decision rule and alternative parameter value. P( 0.1246 / p = 0.10) p ˆ Step 4: Calculate the probability.
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## sample exam 2 key - First 5 letters of your last name Last...

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