Exam 1 Practice Problems 1

Exam 1 Practice Problems 1 - BUAD 310 In-Class Practice...

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- 1 - BUAD 310 In-Class Practice Solutions 9/8/10 1. The Glitzwear catalog is mailed to thousands of people, and these people make (annually) purchases from the catalog, which average \$42 and have a standard deviation of \$60. a) Assuming that the distribution i s normal, find the probability that one person’s purchases will exceed \$40. Soln: 40 42 P X 40 P Z P Z 0.03 0.5 0.0120 0.5120 60 b) Suppose that you would like to obtain a sample of 100 of these people for followup interviews. For a sample of 100, what is the probability that the average annual purchases will exceed \$40? Soln: 6293 . 0 1293 . 0 5 . 0 ) 333 . 0 ( ) 100 / 60 42 40 ( ) 40 ( Z P Z P X P 2. A television cable company receives numerous phone calls throughout the day from customers reporting service troubles and from would-be subscribers to the cable network. Most of these callers are put "on hold" until a company operator is free to help them. The company has determined that the length of time a caller is on hold is normally distributed with a mean of 3.1 minutes and a standard deviation of 0.9 minutes. Company experts have decided that if as many

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