ASSIGNMENT

Course Code

MS - 8

Course Title

Quantitative Analysis for Managerial Applications

Assignment Code

MS-8/ TMA /SEM - II /2015

Coverage

All Blocks

Note: Attempt all the questions and submit this assignment on or before 31st October, 2015 to
the coordinator of your study centre.
1. The frequency distribution of total annual emoluments of a sample of 100 executives
working in multinational companies is given below:
Total Emoluments
(in Rs Lac)

0206

06 10

10-14

14 -18

18-22

22-26

26-30

Number of Executives

10

15

30

18

12

09

06

Find a) median emoluments, b) mode emoluments, c) 3rd quartile, and d) 9th decile.
2. A population consisting of a certain proportion of defective items has mean = 2. If a
sample of 4 items is examined and repeated 200 times, obtain a) probability of an item
being defective, b) probability of getting 2 defective items in the sample, c) expected
frequency of getting 2 defective items, and d) expected frequency of getting at the most 2
defective items. Is the resultant distribution skewed?
3. A research organization claims that the monthly wages of industrial workers in district X
exceeds that of those in district Y by more than Rs 150. Two different samples drawn
independently from the two districts yielded the following results:
District X:
District Y:
Verify at 0.05 level of significance whether the sample results support the claim of the
organization.
4. The following data relate to marketing expenditure in Rs lac and the corresponding sales
of a product in Rs crores. Estimate the marketing expenditure to attain a sales target of Rs
40 crores.
Marketing expenditure
10
12
15
20
23
Product sales
14
17
23
21
25
5. Write short notes on:
i)

Adjoint of a matrix

ii)

Skewness and its measures

iii)

Business forecasting

Course Code :
Course Title :

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MS - 8

Quantitative Analysis for Managerial Applications

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Q2. A population consisting of a certain proportion of defective items has mean = 2. If a sample of 4 items is
examined and repeated 200 times, obtain a) probability of an item being defective, b) probability of getting 2
defective items in the sample, c) expected frequency of getting 2 defective items, and d) expected frequency of
getting at the most 2 defective items. Is the resultant distribution skewed?
Ans:

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Q3.A research organization claims that the monthly wages of industrial workers in district X exceeds that of
those in district Y by more than Rs 150. Two different samples drawn independently from the two districts
yielded the following results:
District X:
District Y:
Verify at 0.05 level of significance whether the sample results support the claim of the organization.

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Q4.
Soln:

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Q5.Write short notes on:

The adjugate has sometimes been called the "adjoint", but today the "adjoint" of a matrix normally refers to its
corresponding adjoint operator, which is its conjugate transpose.

The adjugate of A is the transpose of the cofactor matrix C of A:

In more detail: suppose R is a commutative ring and A is an nn matrix with entries from R.

The (i,j) minor of A, denoted Aij, is the determinant of the (n 1)(n 1) matrix that results from
deleting row i and column j of A.
The cofactor matrix of A is the nn matrix C whose (i,j) entry is the (i,j) cofactor of A:
.

The adjugate of A is the transpose of C, that is, the nn matrix whose (i,j) entry is the (j,i) cofactor of A:
.

The adjugate is defined as it is so that the product of A and its adjugate yields a diagonal matrix whose
diagonal entries are det(A):
.

A is invertible if and only if det(A) is an invertible element of R, and in that case the equation above yields:
,

ii)Skewness and its measures

Ans:
In probability theory and statistics, skewness is a measure of the asymmetry of the probability distribution of a realvalued random variable about its mean. The skewness value can be positive or negative, or even undefined.
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The qualitative interpretation of the skew is complicated. For a unimodal distribution, negative skew indicates that the
tail on the left side of the probability density function is longer or fatter than the right side it does not distinguish these
shapes. Conversely, positive skew indicates that the tail on the right side is longer or fatter than the left side. In cases
where one tail is long but the other tail is fat, skewness does not obey a simple rule. For example, a zero value indicates
that the tails on both sides of the mean balance out, which is the case both for a symmetric distribution, and for
asymmetric distributions where the asymmetries even out, such as one tail being long but thin, and the other being short
but fat. Further, in multimodal distributions and discrete distributions, skewness is also difficult to interpret.
Importantly, the skewness does not determine the relationship of mean and median.
Its measures

Skewness is a measure of symmetry, or more precisely, the lack of symmetry. A distribution, or data set, is symmetric if it
looks the same to the left and right of the center point.

A normal distribution is a bell-shaped distribution of data where the mean, median and mode all coincide. A
frequency curve showing a normal distribution would look like this:

In a normal distribution, approximately 68% of the values lie within one standard deviation of the mean and
approximately 95% of the data lies within two standard deviations of the mean.
If there are extreme values towards the positive end of a distribution, the distribution is said to be positively skewed.
In a positively skewed distribution, the mean is greater than the mode. For example:

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A negatively skewed distribution, on the other hand, has a mean which is less than the mode because of the presence
of extreme values at the negative end of the distribution.
There are a number of ways of measuring skewness:
Pearsons coefficient of skewness =

mean mode = 3(mean median)

Quartile measure of skewness = Q3 2Q2 + Q1

There are a number of different methods by which a business forecast can be made. All the methods fall into
one of two overarching approaches: qualitative and quantitative.

Qualitative Models
Qualitative models have generally been successful with short-term predictions, where the scope of the forecast
is limited. Qualitative forecasts can be thought of as expert-driven, in that they depend on market mavens or
the market as a whole to weigh in with an informed consensus. Qualitative models can be useful in predicting
the short-term success of companies, products and services, but meets limitations due to its reliance on
opinion over measurable data. Qualitative models include:

Market Research Polling a large number of people on a specific product or service to predict how many
people will buy or use it once launched.
Delphi Method: Asking field experts for general opinions and then compiling them into a forecast. (For
more on qualitative modeling, read Qualitative Analysis: What Makes A Company Great?)

Quantitative Models
Quantitative models discount the expert factor and try to take the human element out of the analysis. These
approaches are concerned solely with data and avoid the fickleness of the people underlying the numbers.
They also try to predict where variables like sales, gross domestic product, housing prices and so on, will be in
the long-term, measured in months or years. Quantitative models include:

The Indicator Approach: The indicator approach depends on the relationship between certain
indicators, for example GDP and unemployment rates, remaining relatively unchanged over time. By
following the relationships and then following indicators that are leading, you can estimate the
performance of the lagging indicators, by using the leading indicator data.
Econometric Modeling: This is a more mathematically rigorous version of the indicator approach.
Instead of assuming that relationships stay the same, econometric modeling tests the internal
consistency of data sets over time and the significance or strength of the relationship between data sets.
Econometric modeling is sometimes used to create custom indicators that can be used for a more
accurate indicator approach. However, the econometric models are more often used in academic fields
to evaluate economic policies. (For a basic explanation on applying econometric models, read
Regression Basics For Business Analysis.)

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Time Series Methods: This refers to a collection of different methodologies that use past data to predict
future events. The difference between the time series methodologies is usually in fine details, like giving
more recent data more weight or discounting certain outlier points. By tracking what happened in the
past, the forecaster hopes to be able to give a better than average prediction about the future. This is
the most common type of business forecasting, because it is cheap and really no better or worse than
other methods.

9407

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