Practice Problems for Final Exam
The final exam will be Multiple Choice and T/F only.
1.
Tourism is a major source of income for many Caribbean countries. Suppose the
Bureau of Tourism for Barbados estimates from a sample of 500 tourists that the
average amount spent per day by a tourist is $110 with a margin of error of $2 at a
90% confidence level.
Which of the following statements is consistent with this
information?
A.
A 95% confidence level would increase the margin of error.
B.
An 80% confidence level would increase the margin of error.
C.
A smaller sample would have resulted in a smaller margin of error.
D.
A larger sample would have resulted in a smaller sample average.
2.
An article in your local newspaper claims that the average time to sell a home in
your area is 60 days. You take a sample of 20 homes sold recently and find a 95%
confidence interval to be 65 ± 3 days. Your correct conclusion is that:
A.
Your sample indicates that all homes take longer than 60 days to sell.
B.
Your sample must have been taken incorrectly.
C.
You don’t see any inconsistency between your confidence interval and the statement
in the newspaper.
D.
The newspaper article must be incorrect. Your confidence interval indicates that the
average time to sell a home is greater than 60 days.
3.
The nicotine content in cigarettes of a certain brand is normally distributed, with
mean (in milligrams)
μ
and standard deviation
σ
= 0.1. The brand advertises that the
mean nicotine content of its cigarettes is 1.6, but you are suspicious and plan to
investigate the advertised claim by testing the hypotheses
H
o
:
μ
= 1.6 vs. H
a
:
μ
> 1.6. You have calculated the critical value of
x
to be 1.64.
The power of this test when the true value of
μ
is 1.8 is:
A.
P(
x
<1.64 
μ
= 1.8).
B.
P(
x
<1.64 
μ
= 1.6).
C.
P(
x
>1.64 
μ
= 1.8).
D.
P(
x
>1.64 
μ
= 1.6).
4.
When testing the difference in two treatment responses one could apply each
treatment to the same group of individuals and compare the individual treatment
results by calculating the individual differences. This type of testing procedure is
called a
1
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Two sample test.
B.
One sample test.
C.
Matched pairs design.
D.
Two tailed test.
5.
A New York real estate firm tracks the cost of apartment rentals in the US. In mid
2002, the nationwide mean apartment rental rate was $895 per month (
The Wall
Street Journal,
July 8, 2002). Have apartment rates increased since then? A current
sample from 2004 resulted in a z score of 1.12. Based on this, you would conclude
that
A.
Yes, the sample provides strong evidence to conclude that apartment rates have
increased since 2002.
B.
No, the sample does not provide evidence that apartment rates have changed since
2002.
C.
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 Spring '08
 TOMNELSON
 Normal Distribution, Standard Deviation, Statistical hypothesis testing

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