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COURSE:
MSCI 3710
Print Name:
EXAM 1
Signature:
Version D
S.S.#:
Fall 1998
Seat Number:
Note: Whenever question(s) are connected you may be asked to assume a result
(given a value) from the previous question but this result may or may not be
correct.
This is to prevent you from losing points on a second question because
you made a mistake on a previous question.
Use the information given below to answer the next two questions.
The production manager in a chemical plant knows that the time for a certain product line to
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View Full Documentbecome stable after being stopped for machine adjustments is normally distributed.
He uses a
sample of 10 stoppages to determine a 90% confidence interval for the average warmup period
to be 8.3 to 9.4 minutes.
The firm’s cost accountant would like to answer the following question:
Is there sufficient evidence, at the 10% significance level, to indicate that the average warmup
period is different from 8 minutes?
1.
What should be the decision and conclusion based on the confidence interval?
A.
reject the null hypothesis, conclude that there is evidence the average warmup period is
equal to 8 minutes.
B.
Fail to reject the null hypothesis, conclude that there is insufficient evidence the average
warmup period is not equal to 8 minutes.
C.
Fail to reject the null hypothesis, conclude that there is insufficient evidence the average
warmup period is equal to 8 minutes.
D.
Reject the null hypothesis, conclude that there is evidence the average warmup period is
not equal to 8 minutes.
E.
There is insufficient information given to decide whether the average warmup period is
equal to 8 minutes or not.
2.
The significance level of the hypothesis test in question # 1 refers to
A.
The probability of claiming the average warmup period is not equal to 8 minutes when
in fact it is
not
.
B.
Twice the probability of claiming the average warmup period is equal to 8 minutes when
in fact it is.
C.
The probability of claiming the average warmup period is equal to 8 minutes when in
fact it is
not
.
D.
The probability of claiming the average warmup period is equal to 8 minutes when in
fact it is.
E.
The probability of claiming the average warmup period is not equal to 8 minutes when
in fact it is.
Use the information given in the following paragraph to answer the next three questions.
A manager of BigTex Burgers franchises claims that their restaurants incur annual utility
expenses of at most $25,000 per store.
A potential investor who is considering purchasing a
BigTex franchise is doubtful about this claim, believing the average annual utility expenses to be
more than $25,000.
She obtains a sample of revenues from 15 restaurants and conducts a
statistical analysis on the data using Excel, the results of which are shown below.
Utility Expenses
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 Spring '08
 Dr.Jay

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