Q A M - I I : P R O B L E M S E T- 1

1. Let X1 , X2 , . . . , Xn are independent random variables and E [ Xi ] = µ and Var [ Xi ] = σ2 ∀i. Find
Pn
a. E [ i=1 Xi ]

b. E [ X̄ ]
Pn
c. Var [ i=1 Xi ] Hint: If X and Y are independent random variables then Var [ X + Y ] = Var [ X ] + Var [Y ].

d. Var [ X̄ ] Hint: Use c and Var (aX ) = a2 Var ( X ).

2. The following data are from a simple random sample.

5 8 10 7 10 14

a. What is the point estimate of the population mean?

b. What is the point estimate of the population standard deviation?

3. The weight of an energy bar is normally distributed with a mean of 42.05 grams with a standard
deviation of 0.025 gram.

a. What is the probability that an individual energy bar contains less than 42.035 grams?

b. If a sample of 4 energy bars is selected, what is the probability that the sample mean weight is
less than 42.035 grams?

c. If a sample of 25 energy bars is selected, what is the probability that the sample mean weight
is less than 42.035 grams?

4. The following data represent the responses (Y for yes and N for no) from a sample of 40 college
students to the question “Do you currently own shares in any stocks?”

NNYNNYNYNYNNYNYYNNNY

NYNNNNYNNYYNNNYNNYNN

a. Determine the sample proportion, P, of college students who own shares of stock.

b. If the population proportion is 0.30, determine the standard error of the proportion.

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5. A recent survey reported that 32% of adults are unable to stop thinking about work while on
vacation. Suppose there are a total of 1, 000 adults who booked tours from a certain travel
company. Using a sample size, n = 200, what is the probability that the sample proportion of
adults who were unable to stop thinking about work while on vacation is greater than 0.40?

6. Given a population with a mean of µ = 100 and a variance of σ2 = 900, the central limit theorem
applies when the sample size is n ≥ 30. A random sample of size n = 30 is obtained

a. What are the mean and variance of the sampling distribution for the sample means?

b. What is the probability that X̄ > 109?

c. What is the probability that 96 ≤ X̄ ≤ 110?

d. What is the probability that X̄ ≤ 107?

7. A population has a mean of 200 and a standard deviation of 50. Suppose a simple random sample
of size 100 is selected and is used to estimate µ.

a. What is the probability that the sample mean will be within ±5 of the population mean?

b. What is the probability that the sample mean will be within ±10 of the population mean?

8. A random sample of n = 100 observations is selected from a population with µ = 30 and σ = 16.
Approximate the following probabilities:

a. P( X̄ ≥ 28)
P100
b. P( i = 1 Xi ≤ 2800)

c. P(22.1 ≤ X̄ ≤ 26.8)
P50
d. P( i = 1 Xi ≥ 1350)

9. Suppose that we have a population with proportion P = 0.50 and a random sample of size
n = 900 drawn from the population.

a. What is the probability that the sample proportion is more than 0.52?

b. What is the probability that the sample proportion is less than 0.46?

c. What is the probability that the sample proportion is between 0.47 and 0.53?

10. Shirley Mendez is the manager of quality assurance for Green Valley Foods, Inc., a packer of
frozen-vegetable products. Shirley wants to be sure that the variation of package weights is small
so that the company does not produce a large proportion of packages that are under the stated
package weight. She has asked you to obtain upper limits for the ratio of the sample variance
divided by the population variance for a random sample of n = 20 observations. The limits are
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such that the probability that the ratio is above the upper limit is 0.025. Thus, 97.5% of the ratios
will be below this limit. The population distribution can be assumed to be normal.

11. A population proportion is 0.40. A simple random sample of size 200 will be taken and the
sample proportion will be used to estimate the population proportion.

a. What is the probability that the sample proportion will be within ±0.03 of the population
proportion?

b. What is the probability that the sample proportion will be within ±0.05 of the population
proportion?

12. Your agricultural firm is considering the purchase of some farmland, and an indication of the
quality of the land will be helpful. A random sample of 62 selected locations planted with corn
indicates an average yield of 103.6 bushels per acre, with a standard deviation of 9.4 bushels per
acre. Find the two-sided 95% confidence interval for the mean yield for the entire area under
consideration. Ans: The 95% confidence interval is 101.26 to 105.94 bushels per acre

13. Your quality control department has just analyzed the contents of 20 randomly selected barrels of
materials to be used in manufacturing plastic garden equipment. The results found an average of
41.93 gallons of usable material per barrel, with a standard error of 0.040 gallon per barrel. Find
the two-sided 95% confidence interval for the population mean. Hint: Standard error s = 0.040.
Ans: The 95% confidence interval is (41.91, 41.94)

14. In a sample of 258 individuals selected randomly from a city of 750, 339 people, 165 were
found to be supportive of a new public works project. Find the 99.9% confidence interval for the
support level percentage in the entire city. Ans: The 99.9% confidence interval extends from
54.1% to 73.8%

15. The manager of Northern Steel, Inc., wants to assess the temperature variation in the firm’s new
electric furnace. It is known that temperatures are normally distributed. A random sample of 25
temperatures over a 1-week period is obtained, and the sample variance is found to be 100. Find
a 95% confidence interval for the population variance temperature. Ans: The 95% confidence
interval for the population variance is (60.97, 193.53)

16. A survey is planned to determine the mean annual family medical expenses of employees of a
large company. The management of the company wishes to be 95% confident that the sample
mean is correct to within ±$50 of the population mean annual family medical expenses. A
previous study indicates that the standard deviation is approximately $400.

a. How large a sample is necessary? Ans: 246

b. If management wants to be correct to within ±$25, how many employees need to be selected?
Ans: 984

17. The manager of a department store is thinking about establishing a new billing system for the
store’s credit customers. She determines that the new system will be cost- effective only if the
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mean monthly account is more than $170. A random sample of 400 monthly accounts is drawn,
for which the sample mean is$178. The manager knows that the accounts are approximately
normally distributed with a standard deviation of $65. Using the 5% significance level can the
manager conclude from this that the new system will be cost-effective? Ans: It is cost effective
to install the new billing system

18. A company that manufactures chocolate bars is particularly concerned that the mean weight of
a chocolate bar is not greater than 6.03 ounces. A sample of 50 chocolate bars is selected; the
sample mean is 6.034 ounces, and from the past experience standard deviation is 0.02 ounce.
Using the α = 0.01 level of significance, is there evidence that the population mean weight of
the chocolate bars is greater than 6.03 ounces? Ans: There is insufficient evidence to conclude
that the population mean weight is greater than 6.03 ounces.

19. An advertising media analyst wants to estimate the mean amount of time that consumers spend
with digital media daily. From past studies, the standard deviation is estimated as 45 minutes.

a. What sample size is needed if the media analyst wants to be 90% confident of being correct to
within ±5 minutes?

b. If 99% confidence is desired, how many consumers need to be selected?

20. The branch manager of an outlet (Store 1) of a nationwide chain of pet supply stores wants to
study characteristics of her customers. In particular, she decides to focus on two variables: the
amount of money spent by customers and whether the customers own only one dog, only one
cat, or more than one dog and/or cat. The results from a sample of 70 customers are as follows:

Amount of money spent: X̄ = $21.34, s = $9.22.

a. Construct a 95% confidence interval estimate for the population mean amount spent in the pet
supply store.

b. Construct a 90% confidence interval estimate for the population proportion of customers who
own only a cat.

The branch manager of another outlet (Store 2) wishes to conduct a similar survey in his store.
The manager does not have access to the information generated by the manager of Store 1.
Answer the following questions:

c. What sample size is needed to have 95% confidence of estimating the population mean amount
spent in this store to within ±$1.50 if the standard deviation is estimated to be $10?

d. How many customers need to be selected to have 90% confidence of estimating the population
proportion of customers who own only a cat to within ±0.045?

e. Based on your answers to (c) and (d), how large a sample should the manager take?