Solution_1 - PSTAT 5E Fall 2008 Solutions to Homework 1 8 a...

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Unformatted text preview: PSTAT 5E Fall 2008 Solutions to Homework 1 8 a. 1005 b. Qualitative c. Percentages d. 0.29(1005) = 291.45 or approximately 291 19. 24. a. All subscribers of Business Week in North America at the time the survey was conducted. Quantitative Qualitative (yes or no) Crossectional - all the data relate to the same time. Using the sample results, we could infer or estimate 59% ofthe population of subscribers have an annual income of $75,000 or more and 50% ofthe population of subscribers have an American Express credit card. This is a statistically correct descriptive statistic for the sample. An incorrect generalization since the data was not collected for the entire population. An acceptable statistical inference based on the use ofthe word “estimate.” While this statement is true for the sample, it is not ajustifiable conclusion for the entire population. This statement is not statistically supportable. While it is true for the particular sample observed, it is entirely possible and even very likely that at least some students will be outside the 65 to 90 range ofgrades. . a/b/c/d. Book Value Relative Cumulative Cumulative Ber Share Freguency F reguency Freguency Relative Freguency 0.00-5.99 3 0.10 3 0.10 600-1199 15 0.50 18 0.60 12.00-17.99 9 0.30 27 0.90 18.00-23.99 2 0.07 29 0.97 24.00-29.99 0 0.00 29 0.97 30.00-35.99 _l m 30 1.00 Total 30 1.00 e. The histogram shown below shows that the distribution of most ofthe book values is roughly symmetric. However, there is one outlier (General Motors). l6 I4 12 0 Frequency 00 6 4 2 - 0 — 0.00-5.99 600-1199 12.00- 18.00- 24.00- 30.00- 1799 23.99 29.99 35.99 Book Value 43. a. Relative Exchange Freguencx Freguencx American 3 0.15 New York 2 0.10 Over the Counter 15 w 20 1.00 b. Earnings Per Relative Share Freguencx Freguencx 0.00-0.19 7 0.35 0.20 - 0.39 7 0.35 0.40 - 0.59 1 0.05 0.60 - 0.79 3 0.15 0.80 - 0.99 3 0.19 20 1.00 Seventy percent of the shadow stocks have earnings per share less than $0.40. It looks like low EPS should be expected for shadow stocks. Price-Earning Relative Ratio F reguencx Freguencx 0.00 - 9.9 3 0.15 10.0 - 19.9 7 0.35 20.0 - 29.9 4 0.20 30.0 - 39.9 3 0.15 40.0-49.9 2 0.10 50.0 - 59.9 _1 0'0; 20 1.00 P-E Ratios vary considerably. but there is a significant cluster in the 10 — 19.9 range. 13. Range20-10=10 10,12,16,17,2o 25 i=— 5 =1.25 100() Q. (2nd position) = 12 75 i=-—— 5 =3.75 100() Q; (4th position) = 17 1QR=Q3-Q.=17-12=5 I4. 35. s —— —-= 16 rI—l 4 s=\/—lg=4 i=33L=23§9=399 n Median =M = 4.185 (average of 10th and 11th values) Q. = 4.00 (average of 5th and 6th values) Q = 4.50 (average of 15th and 16th values) —2 s: ’20:, x) : [12.51.1081 n—l 19 Allison One: 2 = = 0.16 0.81 2.32—3.99 0.81 Omni Audio SA 12.3: 2 = = ~2.06 The lowest rating is for the Bose 501 Series. Its z-score is: _2J4—399 am 2 =—2.28 This is not an outlier so there are no outliers. ...
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