ADM 2303 Final Examination
 1 
April 20, 1997
University of Ottawa
Faculty of Administration
ADM 2303: STATISTICS FOR MANAGEMENT I
FINAL EXAMINATION
April 20, 1997
14001700
NAME:
S.N.
Section:
Time: 3 hours
Total marks: 50
ALL ANSWERS (INCLUDING BRIEF EXPLANATIONS) GO ON THE ANSWER SHEET. THE EXAM
QUESTION SHEETS WILL
NOT
BE MARKED, though space is provided here for your rough work. The
question sheets
must
be deposited in the box provided. NOTE THAT THERE ARE MARKS FOR EXPLAINING
YOUR ANSWERS, SO MAKE SURE YOU INCLUDE BRIEF EXPLANATIONS ON THE
ANSWER
SHEET.
THERE ARE MARKS FOR IDENTIFYING PROBABILITY DISTRIBUTIONS. Calculators, 1 sheet of notes,
and approved statistical tables permitted (MBB or signed by J C Nash). You do
not
need to interpolate, but take
the nearest table value.
1. Acme Soap Co. markets its bars of soap under two different brand names that pretend to be fierce competitors:
CleanyourClock (CYC) and Wedge 1000. Both are made on the same production line with simply different
packaging. Sales of CYC average 2350 boxes per week with standard deviation 402 boxes. Wedge sales average
1500 boxes per week with standard deviation 350 boxes. Acme sells Wedge for $25 per box (there are 200 bars of
soap in a box) and CYC to $18 per box. For some reason, soap sales rise and fall with the business cycle, so the
correlation between the sales of the two brands has a correlation of 0.55.
a) [ 5 ] What is the standard deviation of the combined weekly revenue from both types of soap?
b) [ 2 ] What is the mean combined weekly revenue from both types of soap?.
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ADM 2303 Final Examination
 2 
April 20, 1997
Q 2. A Revenue Canada auditor is told by his/her director that 15% of selfemployed people make claims that are
exaggerated, that is, go beyond the allowances of the Tax Act, but that only 0.1% are clearly fraudulent. Assume
these figures are correct, and that the auditors are good enough to catch all errors and frauds.
The auditor investigates 6 accounts drawn at random from the files.
a) [ 3 ] What is the probability no accounts have exaggerated claims?
b) [ 3 ] What is the probability two or more accounts have exaggerated claims?
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