Question 1

Look at the utility function graphed below and select the type of decision maker that corresponds to the graph.

Accepted Answer

A) Risk averter 
B) Risk neutral 
C) Risk taker 
D) Risk player

Question 2

TABLE 9-2
An appliance manufacturer claims to have developed a compact microwave oven that consumes a population mean of no more than 250 W.From previous studies,it is believed that power consumption for microwave ovens is normally distributed with a population standard deviation of 15 W.If there is evidence that the population mean consumption is greater than 250 W,the manufacturer will be unable to make the claim.
-Referring to Table 9-2,if you select a sample of 20 compact microwave ovens and are willing to have a level of significance of 0.05,the power of the test is ________ if the mean power consumption of all such microwave ovens is in fact 257.3 W.

Accepted Answer

The answer of TABLE 9-2
An appliance manufacturer claims to have...

Question 3

TABLE 9-1
A manufacturer produces light bulbs that have a mean life of at least 500 hours when the production process is working properly.Based on past experience,the population standard deviation is 50 hours and the light bulb life is normally distributed.The operations manager stops the production process if there is evidence that the population mean light bulb life is below 500 hours.
-Referring to Table 9-1,if you select a sample of 100 light bulbs and are willing to have a level of significance of 0.10,the confidence coefficient of the test is ________ if the population mean bulb life is 510 hours.

Accepted Answer

The answer of TABLE 9-1
A manufacturer produces light bulbs that...

Question 4

TABLE 19-1
The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. 
-Referring to Table 19-1,if the probability of S1 is 0.5,then the expected monetary value (EMV)for A2 is

Accepted Answer

A) 3 
B) 4 
C) 6.5 
D) 8

Question 5

TABLE 19-6
A student wanted to find out the optimal strategy to study for a Business Statistics exam.He constructed the following payoff table based on the mean amount of time he needed to study every week for the course and the degree of difficulty of the exam.From the information that he gathered from students who had taken the course,he concluded that there was a 40% probability that the exam would be easy.
 
-Referring to Table 19-6,what is the expected opportunity loss of spending 8 hours per week on average studying for the exam?

Accepted Answer

The answer of TABLE 19-6
A student wanted to find out...

Question 6

TABLE 6-1
A company has 125 personal computers.The probability that any one of them will require repair on a given day is 0.15.
-Referring to Table 6-1 and assuming that the number of computers that requires repair on a given day follows a binomial distribution,compute the probability that there will be between 25 and 30 computers that require repair on a given day using a normal approximation.

Accepted Answer

The answer of TABLE 6-1
A company has 125 personal computers.The...

Question 7

TABLE 12-2
An agronomist wants to compare the crop yield of 3 varieties of chickpea seeds.She plants all 3 varieties of the seeds on each of 5 different patches of fields.She then measures the crop yield in bushels per acre.Treating this as a randomized block design,the results are presented in the table that follows.
 
-Referring to Table 12-2,what is the value of the test statistic for the Friedman rank test for the difference in the medians?

Accepted Answer

The answer of TABLE 12-2
An agronomist wants to compare the...

Question 8

For a given level of significance,if the sample size is increased but the summary statistics remain the same,the power of the test will increase.

Accepted Answer

A) True 
 B)False

Question 9

TABLE 6-1
A company has 125 personal computers.The probability that any one of them will require repair on a given day is 0.15.
-Referring to Table 6-1 and assuming that the number of computers that requires repair on a given day follows a binomial distribution,compute the probability that there will be exactly 10 computers that require repair on a given day using a normal approximation.

Accepted Answer

The answer of TABLE 6-1
A company has 125 personal computers.The...

Question 10

TABLE 19-3
The following information is from 2 investment opportunities.
 
-Referring to Table 19-3,what is the return to risk ratio for Investment B?

Accepted Answer

A) 8 
B) 10 
C) 12 
D) 24

Question 11

TABLE 8-2
A wealthy real estate investor wants to decide whether it is a good investment to build a high-end shopping complex in a suburban county near Chicago.His main concern is the total market value of the 3,605 houses in the suburban county.He commissioned a statistical consulting group to take a sample of 200 houses and obtained a sample mean market price of $225,000 and a sample standard deviation of $38,700.The consulting group also found out that the mean differences between market prices and appraised prices was $125,000 with a standard deviation of $3,400.Also the proportion of houses in the sample that are appraised for higher than the market prices is 0.24.
-Referring to Table 8-2,what will be the 90% confidence interval for the total market price of the houses in the suburban county constructed by the consulting group?

Accepted Answer

The answer of TABLE 8-2
A wealthy real estate investor wants...

Question 12

TABLE 19-5
The following payoff table shows profits associated with a set of 2 alternatives under 3 possible events. 
-Referring to Table 19-5,what is the EVPI for this problem?

Accepted Answer

The answer of TABLE 19-5
The following payoff table shows profits...

Question 13

TABLE 19-6
A student wanted to find out the optimal strategy to study for a Business Statistics exam.He constructed the following payoff table based on the mean amount of time he needed to study every week for the course and the degree of difficulty of the exam.From the information that he gathered from students who had taken the course,he concluded that there was a 40% probability that the exam would be easy.
 
-Referring to Table 19-6,the optimal strategy using the coefficient of variation criterion is to study 8 hours per week on average for the exam.

Accepted Answer

A) True 
 B)False

Question 14

TABLE 19-2
The following payoff matrix is given in dollars.
 
-Referring to Table 19-2,what is the action with the preferable coefficient of variation?

Accepted Answer

A) Action A 
B) Action B 
C) Either Action A or Action B 
D) It cannot be determined.

Question 15

If a new machine of a production plant is functioning properly,only 1% of the items produced will be defective.Out of the 1,000 items the plant produces on a single day,the approximate probability that none of the items will be defective if the new machine is indeed functioning properly is ________.

Accepted Answer

The answer of If a new machine of a production...

Question 16

TABLE 8-1
A random sample of 100 stores from a large chain of 500 garden supply stores was selected to determine the mean number of lawnmowers sold at an end-of-season clearance sale.The sample results indicated a mean of 6 and a standard deviation of 2 lawnmowers sold.A 95% confidence interval (5.623 to 6.377)was established based on these results.
-Referring to Table 8-1,we do not know for sure whether the true population mean is between 5.623 and 6.377 lawnmowers sold.

Accepted Answer

A) True 
 B)False

Question 17

Based on past experience,only 0.5% of the invoices of a company contain an error.Out of the 1,500 invoices that the company will issue,what is the approximate probability that at least 4 invoices will contain an error?

Accepted Answer

The answer of Based on past experience,only 0.5% of the...

Question 18

TABLE 19-5
The following payoff table shows profits associated with a set of 2 alternatives under 3 possible events. 
-Referring to Table 19-5,what is the optimal action using the coefficient of variation?

Accepted Answer

The answer of TABLE 19-5
The following payoff table shows profits...

Question 19

TABLE 19-1
The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. 
-Blossom's Flowers purchases roses for sale for Valentine's Day.The roses are purchased for $10 a dozen and are sold for $20 a dozen.Any roses not sold on Valentine's Day can be sold for $5 per dozen.The owner will purchase 1 of 3 amounts of roses for Valentine's Day: 100,200,or 400 dozen roses.Given 0.2,0.4,and 0.4 are the probabilities for the sale of 100,200,or 400 dozen roses,respectively,then the EOL for buying 200 dozen roses is

Accepted Answer

A) $700. 
B) $900. 
C) $1,500. 
D) $1,600.

Question 20

TABLE 12-2
An agronomist wants to compare the crop yield of 3 varieties of chickpea seeds.She plants all 3 varieties of the seeds on each of 5 different patches of fields.She then measures the crop yield in bushels per acre.Treating this as a randomized block design,the results are presented in the table that follows.
 
-Referring to Table 12-2,the decision made at a 0.01 level of significance on the Friedman rank test for the difference in medians implies that all 3 medians are significantly different.

Accepted Answer

A) True 
 B)False

Exam 19: Questions that Involve Online Topics

Look at the utility function graphed below and select the type of decision maker that corresponds to the graph.

TABLE 19-1 The following payoff table shows profits associated with a set of 3 alternatives under 2 possible states of nature. -Referring to Table 19-1,if the probability of S1 is 0.5,then the expected monetary value (EMV) for A2 is

For a given level of significance,if the sample size is increased but the summary statistics remain the same,the power of the test will increase.

TABLE 19-3 The following information is from 2 investment opportunities. -Referring to Table 19-3,what is the return to risk ratio for Investment B?

TABLE 19-5 The following payoff table shows profits associated with a set of 2 alternatives under 3 possible events. -Referring to Table 19-5,what is the EVPI for this problem?

TABLE 19-2 The following payoff matrix is given in dollars. -Referring to Table 19-2,what is the action with the preferable coefficient of variation?

If a new machine of a production plant is functioning properly,only 1% of the items produced will be defective.Out of the 1,000 items the plant produces on a single day,the approximate probability that none of the items will be defective if the new machine is indeed functioning properly is ________.

Based on past experience,only 0.5% of the invoices of a company contain an error.Out of the 1,500 invoices that the company will issue,what is the approximate probability that at least 4 invoices will contain an error?

TABLE 19-5 The following payoff table shows profits associated with a set of 2 alternatives under 3 possible events. -Referring to Table 19-5,what is the optimal action using the coefficient of variation?