Economic Methods - Seminar 8 Qs

Economic Methods Seminar
Statistics Worksheet 3
All the questions are taken from the textbook (with the question number used in
the textbook also used here). Please have your answers ready for presentation
and discussion in the class.
Pre-Seminar Questions
6.9 When a production process is operating correctly, the number of units

produced per hour has a normal distribution with a mean of 92.0 and a
standard deviation of 3.6. A random sample of 4 different hours was taken.
a) Find the mean of the sampling distribution of the sample mean.
b) Find the variance of the sampling distribution of the sample mean.
c) Find the standard error of the sampling distribution of the sample mean.
d) What is the probability that the sample mean exceeds 93.0 units?
6.29 Suppose that we have a population with proportion P = 0.50 and a random
sample of size n = 900 is 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?
7.4 A random sample of 12 employees in a large manufacturing plant found the

following figures for number of hours of overtime worked in the last
month:
22 16 28 12 18 36 23 11 41 29 26 31
Use unbiased estimation procedures to find point estimates for the
following:
a) The population mean
b) The population variance
c) The variance of the sample mean
d) The population proportion of employees working more than 30 hours of
overtime in this plant in the last month
1
7.16 A process produces bags of refined sugar. The weights of the contents of
these bags are normally distributed with standard deviation 1.2 ounces.
The contents of a random sample of 25 bags had a mean weight of 19.8
ounces. Find the upper and lower confidence limits of a 99% confidence
interval for the true mean weight for all bags of sugar produced by the
process.
7.20 Find the lower confidence limit and upper confidence limit for each of the
following.
a) α = 0.05; n = 25; x̄=560 ; s = 45
b) α/2 = 0.05; n = 9; x̄=160 ; s2 = 36
c) 1 - α = 0.98; n = 22; x̄=58 ; s = 15
7.31 Calculate the confidence interval to estimate the population proportion for
each of the following.
a) 98% confidence level; n = 450; ^p=0. 10
b) 95% confidence level; n = 240; ^p=0. 01
c) α = 0.04; n = 265; ^p=0.50
8.3 An educational study was designed to investigate the effectiveness of a

reading program of elementary age children. Each child was given a pretest
and posttest. Higher posttest scores would indicate reading improvement.
From a very large population, a random sample of scores for the pretest
and posttest are as follows:
Child Pretest Posttest Score
Score
1 40 48
2 36 42
3 32
4 38 36
5 43
6 33 38
7 35 45
Child 3 moved from the school district and did not take the posttest. Child 5
moved into the district after the start of the study and did not take the
pretest. Find a 95% confidence interval estimate of the mean improvement
in the reading scores.
8.6 Independent random sampling from two normally distribution populations

give the following results:
n x =64 ; x̄=400 ; σ x =20
n y=36 ; ȳ=360 ; σ y =25
2
Find a 90% confidence interval estimate of the difference between the
means of the two populations.
8.20 In a random sample of 120 large retailers, 85 used regression as a method

of forecasting. In an independent random sample of 163 small retailers, 78
used regression as a method of forecasting. Find a 98% confidence interval
for the difference between the two population proportions.
Seminar Questions
6.12 The mean selling price of senior condominiums in Green Valley over a year
was $215,000. The population standard deviation was $25,000. A random
sample of 100 new unit sales was obtained.
a) What is the probability that the sample mean selling price was more than
$210,000?
b) What is the probability that the sample mean selling price was between
$213,000 and $217,000?
c) What is the probability that the sample mean selling price was between
$214,000 and $216,000?
d) Without doing the calculations, state in which of the following ranges the
sample mean selling price is most likely to lie:
$213,000 to $215,000; $214,000 to $216,000; $215,000 to $217,000;
$216,000 to $218,000
e) Suppose that, after you had done these calculations, a friend asserted that
the population distribution of selling prices of senior condominiums in
Green Valley was not normal. How would you respond?
6.42 Suppose that 50% of adult Australians believe that Australia should apply
to host the next rugby World Cup. Calculate the probability that more than
56% of a random sample of 150 adult Australians would believe this.
7.28 A business school placement director wants to estimate the mean annual
salaries 5 years after students graduate. A random sample of 25 such
graduates found a sample mean of £42,740 and a sample standard
deviation of £4,780. Find a 90% confidence interval for the population
mean, assuming that the population distribution is normal.
7.39 A Malaysian airline wanted to determine if customers would be interested

in paying a $10 flat fee for unlimited Internet access during long-haul
flights. From a random sample of 200 customers, 125 indicated that they
would be willing to pay this fee. Using this survey data, determine the 99%
confidence interval estimate for the population proportion of the airline’s
customers who would be prepared to pay this fee for Internet use.
3
8.5 A random sample of six salespeople who attended a motivational course on
sales techniques was monitored 3 months before and 3 months after the
course. The table shows the value of sales (in thousands of dollars)
generated by these six salespeople in the two periods. Assume that the
population distributions are normal. Find an 80% confidence interval for
the difference between the two population means.
Salesperson Before the After the Course
Course
1 212 237
2 282 291
3 203 191
4 327 341
5 165 192
6 198 180
8.12 A manufacturer knows that the numbers of items produced per hour by
machine A and by machine B are normally distributed with a standard
deviation of 8.4 items for machine A and a standard deviation of 11.3 items
for machine B. The mean hourly amount produced by machine A for a
random sample of 40 hours was 130 units; the mean hourly amount
produced by machine B for a random sample of 36 hours was 120 units.
Find the 95% confidence interval for the difference in mean parts produced
per hour by these two machines.

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Economic Methods Seminar

6.9 When a production process is operating correctly, the number of units

7.4 A random sample of 12 employees in a large manufacturing plant found the

8.3 An educational study was designed to investigate the effectiveness of a

8.6 Independent random sampling from two normally distribution populations

8.20 In a random sample of 120 large retailers, 85 used regression as a method

7.39 A Malaysian airline wanted to determine if customers would be interested

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