ISE Business Statistics Communicating With Numbers 4th International Edition Sanjiv Jaggia, Alison Kelly - Solutions

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* The accompanying data file shows the U.S.inflation rate as measured by the consumer price index from 1990 through 2019. Use the method of runs above and below the median with a significance level of 5% to test the null hypothesis of randomness against the alternative hypothesis of nonrandomness.
* DJIA. The accompanying data file shows the daily Dow Jones Industrial Average (DJIA) for the 251 trading days in 2019. At the 5% significance level, use the method of runs above and below the median to test the random walk hypothesis that suggests that prices move randomly over time with no
* China_GDP. The accompanying data file shows the gross domestic product (GDP) for China from 1990 through 2018. Use the method of runs above and below the median with a significance level of 5% to test the null hypothesis of randomness against the alternative that there is a trend or cyclical
Inspectors. In order to ensure the public’s health and safety, state health inspectors are required to rate the cleanliness and quality of all restaurants in the state. Restaurants that consistently score below a certain level often lose their licenses to operate. From a sample of 10 restaurants,
Mutual_Funds2. The accompanying data file shows the annual returns (in %) for two mutual funds over the past 10 years.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient differs from zero.b. Calculate and interpret the Spearman correlation
A research analyst believes that a positive relationship exists between a firm’s advertising expenditures and its sales. For 65 firms, she collects data on each firm’s yearly advertising expenditures and subsequent sales. She calculates the Spearman rank correlation coefficient as rS = 0.45.a.
PE_Ratio. An economist wants to determine whether the Price/Earnings (P/E) ratio is the same for firms in three industries. Five firms were randomly selected from each industry. The accompanying data file shows the results.a. Specify the competing hypotheses to test whether some median P/E ratios
* Test_Centers. A psychiatrist believes that the location of a test center may influence a test taker’s performance. To test his claim, he collects SAT scores from four different locations.The accompanying data file shows the results.a. Specify the competing hypotheses to test whether some median
* Refrigerator. A consumer advocate researches the length of life between two brands of refrigerators, Brand A and Brand B. He collects data on the longevity of 40 refrigerators for Brand A and repeats the sampling for Brand B. The accompanying data file shows the results.a. Specify the competing
Fertilizer. A farmer is concerned that a change in fertilizer to an organic variant might change his crop yield. He subdivides six lots and uses the old fertilizer on one half of each lot and the new fertilizer on the other half. The accompanying data file shows the results.a. Specify the competing
Comparison. The accompanying data file shows the returns for Stock 1 and Stock 2 over the past 11 years.a. Specify the competing hypotheses to determine whether the median difference between the returns differs from zero.b. Calculate the value of the Wilcoxon signedrank test statistic T. Assume
PharmFirm. The accompanying data file shows the closing stock price (in $) for a phamaceutical firm over the past five days.a. Specify the competing hypotheses to determine whether the median stock price is greater than$61.25.b. Calculate the value of the Wilcoxon signedrank test statistic T.c. The
* BioTech. A financial analyst follows the daily stock price of a biotechnology firm over the past year. She wants to test the random walk hypothesis that suggests that stock prices move randomly over time with no discernible pattern.a. Use the method of runs above and below the median to test the
* Absenteeism. The superintendent of a large suburban high school must decide whether to close the school for at least two days due to the spread of flu. If she can confirm a trend in absenteeism, then she will close the high school. The accompanying data file shows the number of students absent
* India_GDP. The accompanying data file shows the growth rate in the gross domestic product (GDP) for India from 1990 through 2018. Use the method of runs above and below the median with a significance level of 5% to test the null hypothesis of randomness against the alternative that there is a
Given the digits zero through nine, a computer program is supposed to generate even and odd numbers randomly. The computer produced the following sequence of numbers:5 3 4 6 8 0 2 9 7 7 1 6 8 3 1 5 2 4 3 3 9 2a. Specify the competing hypotheses to test for nonrandomness.b. What is the value of the
Let D denote a desirable outcome and U denote an undesirable outcome. The sequence of the outcomes is as follows:DDDUUDUUUUUDDDUUDUUUDDDUUUUDDD At the 1% significance level, conduct a hypothesis test to determine if the outcomes are nonrandom.Applications
PhD_Rating. For scholarship purposes, two graduate faculty members rate 12 applicants to the PhD program on a scale of 1 to 10 (with 10 indicating an excellent candidate). These ratings are shown in the accompanying data file.a. Using the sign test, specify the competing hypotheses to determine
Water. Concerned with the increase of plastic water bottles in landfills, a leading environmentalist wants to determine whether there is any difference in taste between the local tap water and the leading bottled water. She randomly selects 14 consumers and conducts a blind taste test. She asks the
Last year, 100 registered voters were asked to rate the effectiveness of the president of the United States. This year, these same people were again asked to make the same assessment.Seventy percent of the second ratings were lower than the first ratings and 30% were higher.a. Using the sign test,
Consider the following sign data, produced from a matchedpairs sample of ordinal-scaled observations.+ − − + − − + − + − + − − − + −a. Specify the competing hypotheses to determine whether the proportion of negative signs is significantly greater than the proportion of positive
Consider the following sign data, produced from a matchedpairs sample of ordinal-scaled observations.+ + + − + + − + + + + − + + − − + + + +a. Specify the competing hypotheses to determine whether the proportion of negative signs differs from the proportion of positive signs.b. Calculate
Consider the following competing hypotheses and sample data.H 0 : p ≤ 0.50 H A : p > 0.50 n = 25 ¯ p  = 0.64a. Calculate the value of the test statistic for the sign test.b. Calculate the p-value.c. At the 1% significance level, what is the conclusion? Explain.
Consider the following competing hypotheses and sample data.H 0 : p = 0.50 H A : p ≠ 0.50 n = 40 ¯ p = 0.30a. Calculate the value of the test statistic for the sign test.b. Calculate the p-value.c. At the 5% significance level, what is the conclusion? Explain.
* Gambling. The accompanying data file shows the number of cases of crime related to gambling and offenses against the family and children for the 50 states in the United States. Using the Spearman rank correlation coefficient, determine whether gambling and family abuse are correlated at the 5%
* Happiness. Many attempts have been made to relate happiness with various factors. One such study relates happiness with age and finds that, holding everything else constant, people are least happy when they are in their mid-40s. The accompanying data file shows a respondent’s age and his/her
* GRE_GPA. The director of graduate admissions at a local university is analyzing the relationship between scores on the Graduate Record Examination (GRE) and subsequent performance in graduate school, as measured by a student’s grade point average (GPA). She uses a sample of seven students who
* Price_Days. The accompanying data file shows the price of a house (Price in $1,000s) and the number of days it takes to sell the house (Days) for a sample of eight recent transactions.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient differs from
Assets. You are interested in whether the returns on Asset A (in %) are negatively correlated with the returns on Asset B (in %). You collect six years of annual return data on the two assets.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient is less
WB_Ranking. The accompanying data file shows the ranking of the richest countries, as measured by per capita GNP. In addition, it gives each country’s rank with respect to infant mortality. A higher rank indicates a lower mortality rate.a. Specify the competing hypotheses to determine whether the
Judge_Ranking. The accompanying data file shows the ranks given by two judges to the performance of six finalists in a men’s figure skating competition.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient is different from zero.b. Calculate and
Consider the following competing hypotheses and accompanying sample data.H 0 : ρ s ≤ 0 H A : ρ s  > 0 r s = 0.64 and n = 50a. What is the value of the test statistic and its associated p-value? Assume the normal approximation for rs.b. At the 1% significance level, what is the
Exercise_20.38. The accompanying data file shows six observations for two variables, x and y.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient is less than zero.b. Calculate and interpret rs.c. The p-value associated with the test statistic in part b
Exercise_20.37. The accompanying data file shows six observations for two variables, x and y.a. Specify the competing hypotheses to determine whether the Spearman rank correlation coefficient differs from zero.b. Calculate and interpret rs.c. The p-value associated with the test statistic in part b
* Job_Satisfaction. A human resource specialist wants to determine whether the median job satisfaction score (on a scale of 0 to 100) differs depending on a person’s field of employment. She collects scores from 30 employees in three different fields. The accompanying data file shows the
* Exam_Scores. A statistics instructor wonders whether significant differences exist in her students’ median exam scores in her three different sections. She randomly selects scores from 10 different students in each section. The accompanying data file shows the results. Do these data provide
Detergents. In order to compare the cleansing action of the top three detergents, 15 swatches of white cloth were soiled with red wine and grass stains and then washed in front-loading machines with the respective detergents.The accompanying data file shows the whiteness readings for each
Industry_Returns. A research analyst examines annual returns (in percent) for Industry A, Industry B, and Industry C. The accompanying data file shows the results.a. Specify the competing hypotheses to test whether some differences exist in the median returns by industry.b. Calculate the value of
Bulb. A quality-control manager wants to test whether there is any difference in the median length of life of light bulbs between three different brands. Random samples were drawn from each brand, where the duration of each light bulb (in hours)was measured. The results are shown in the
Unemployment. A research analyst wants to test whether the median unemployment rate differs from one region of the country to another. She collects the unemployment rate(in percent) of similar-sized cities in three regions of the United States. The accompanying data file shows the results.a.
* Exercise_20.30. Random samples were drawn from four independent populations. The accompanying data file shows the results.a. Specify the competing hypotheses to test whether some differences exist between the medians.b. At the 5% significance level, do some medians differ? Explain.Applications
South_Koreans. According to a study, South Koreans spend more hours per year on the job than people in any other developed country. The accompanying data file reports the number of hours worked in the last year by 10 workers in South Korea and by 10 workers in the United States.a. Set up the
* Spending. Researchers at the Wharton School of Business have found that men and women shop for different reasons. While women enjoy the shopping experience, men are on a mission to get the job done. Men do not shop as frequently, but when they do, they make big purchases like expensive
* Income. A study suggests that married men have a higher median income than unmarried men. The accompanying data file shows the incomes (in $1,000s) of six married men and seven unmarried men.a. Set up the hypotheses to test the claim that the median income of married men is greater than the
* Statistics. A professor teaches two sections of an introductory statistics course. He gives each section the same final and wonders if any significant differences exist between the medians of these sections. The accompanying data file shows seven scores from Section A and six scores from Section
Appraisals. A bank employs two appraisers. When approving borrowers for mortgages, it is imperative that the appraisers provide consistent appraisals to the same types of properties. To make sure that this is the case, the bank asks the appraisers to value 10 different properties (in $).a. Specify
Diet. A diet center claims that it has the most effective weight loss program in the region. Its advertisement says, “Participants in our program really lose weight.” Five clients of this program are weighed on the first day of the diet and then three months later.a. Specify the null and
* Mock_SAT. Suppose eight college-bound students take a mock SAT, complete a three-month test-prep course, and then take the real SAT.a. Specify the competing hypotheses to determine whether the median score on the real SAT is greater than the median score on the mock SAT.b. At the 5% significance
The following data are provided for two samples drawn from independent populations: W = 545, n1 = 25, and n2 = 25.Suppose the distribution of W is approximately normal.a. Calculate the mean and the standard deviation of the distribution of W.b. Specify the competing hypotheses to determine whether
Exercise_20.17. Random samples were drawn from two independent populations. The accompanying data file shows the results.a. Specify the competing hypotheses to determine whether the median of Population 1 is greater than the median of Population 2.b. Find the unadjusted sum of ranks, W.c. The
Exercise_20.16. Random samples were drawn from two independent populations. The accompanying data file shows the results.a. Specify the competing hypotheses to determine whether the median of Population 1 is less than the median of Population 2.b. Find the unadjusted sum of ranks, W.c. The p-value
Exercise_20.15. The accompanying data file contains information on a matched-pairs sample.a. Specify the competing hypotheses that determine whether the median difference differs from zero.b. Assuming a normal approximation for T, determine the value of the test statistic.c. Calculate the
* Exercise_20.14. The accompanying data file contains information on a matched-pairs sample.a. Specify the competing hypotheses that determine whether the median difference between Population 1 and Population 2 is less than zero.b. At the 5% significance level, what is the conclusion to the
Consider the following competing hypotheses and accompanying sample data drawn from a matched-pairs sample.H 0 : m D = 0 H A : m D ≠ 0 n = 50 T − = 400 T + = 875a. Determine the value of the test statistic using a normal approximation for T.b. Calculate the p-value.c. At the 5% significance
* Convenience. An entrepreneur examines monthly sales (in $1,000s) for 40 convenience stores in Rhode Island.a. Specify the competing hypotheses to determine whether median sales differ from $130,000.b. At the 5% significance level, do median sales differ from$130,000? Explain.
* Houses. A realtor believes that the median price of a house is more than $500,000. The accompanying data is in$1,000s.a. Specify the competing hypotheses for the test.b. At the 5% significance level, is the realtor’s claim supported by the data? Explain.
* Wage. An economist wants to test whether the median hourly wage is less than $22.a. Specify the competing hypotheses for the test.b. At the 5% significance level, can you conclude that the median hourly wage is less than $22? Explain.
City_Rent. The accompanying data file lists the average rent per square foot (in $) for 10 cities.a. Specify the competing hypotheses to determine whether the median rent is greater than $25 per square foot.b. Calculate the value of the test statistic, using a normal distribution approximation for
Balanced. The accompanying data file shows the annual returns (in %) for a mutual fund over a 10-year period.a. Specify the competing hypotheses to determine whether the median return is greater than 5%.b. Calculate the value of the test statistic, using a normal distribution approximation for T.c.
A random sample of eight drugstores shows the following prices (in $) for a popular pain reliever:5.00 4.25 3.75 5.50 5.75 6.25 5.25 4.25a. Specify the competing hypotheses to determine whether the median price is less than $6.00.b. Calculate the value of the test statistic.c. The p-value
Consider the following sample data.105 90 110 80 85 85 103 70 115 75 Assume the normal approximation for T.a. Specify the competing hypotheses to determine whether the median differs from 100.b. Calculate the value of the test statistic and the p-value.c. At the 10% significance level, is the
Consider the following competing hypotheses and sample data.H 0 : m ≤ 150 H A : m > 150 n = 30 T −  = 200 T +  = 265a. Assuming that the sampling distribution of T is normally distributed, calculate the value of the test statistic.b. Calculate the p-value.c. At the 5% significance
Consider the following sample data.8 5 11 7 6 5a. Specify the competing hypotheses to determine whether the median is less than 10.b. Calculate the value of the test statistic T.c. The p-value corresponding to the test statistic in part b is approximately equal to 0.029. At the 5% significance
Consider the following sample data:150 145 138 155 141 152a. Specify the competing hypotheses to determine whether the median is greater than 140.b. Calculate the value of the test statistic T.c. The p-value corresponding to the test statistic in part b is equal to 0.047. At the 5% significance
Consider the following sample data:25 18 21 27 30a. Specify the competing hypotheses to determine whether the median differs from 20.b. Calculate the value of the test statistic T.c. The p-value corresponding to the test statistic in part b is equal to 0.188. At the 5% significance level, does the
The consumer price index (CPI), with a base of 1982-84, increased from 218.06 in 2010 to 255.66 in 2019. The corresponding increase in the producer price index (PPI) was from 175.40 in 2010 to 196.80 in 2019.a. Use the appropriate price index to compute John’s percentage change in real income if
Lindsay Kelly bought 100 shares of a finance firm, 300 shares of a manufacturing firm, and 500 shares of a technology firm in Year 1. The adjusted closing prices of these stocks over the next three years are shown in the accompanying table.Year Finance Manufacturing Technology 1 195.62 24.11 13.36
Consider the following table, representing the net revenue and net income of a startup over two years.Both variables are measured in millions of dollars.Year Net Revenue Net Income 1 146.6 21.2 2 159.2 13.6a. Compute and interpret the simple price index for net revenue, using Year 1 as the base
Let the quantities corresponding to the prices in the previous exercise be given by the following table.Year Product 1 Product 2 Product 3 2018 90 32 48 2019 82 34 46 2020 76 30 36a. Compute the Laspeyres price index, using 2018 as the base year.b. Compute the Paasche price index, using 2018 as the
Consider the following price data from 2018 to 2020.Year Product 1 Product 2 Product 3 2018 38 94 45 2019 40 92 48 2020 42 98 56a. Compute and interpret the simple price index for each product, using 2018 as the base year.b. Compute and interpret the unweighted aggregate price index, using 2018 as
Price. The accompanying table shows a portion of price data from 2012 to 2020.Year 2012 2013 ⋯ 2020 Price 3.20 3.46 ⋯ 4.70a. Compute the simple price index using 2012 as the base year.b. Update the index numbers with a base year revised from 2012 to 2015.
The following table shows the monthly adjusted closing price per share of a manufacturing firm from October 2019 to March 2020.Date Adjusted Closing Price Date Adjusted Closing Price October 2019 78.89 January 2020 77.00 November 2019 78.54 February 2020 74.83 December 2019 84.16 March 2020 79.56a.
Kim Baek invested $20,000 for a year in corporate bonds. Each bond sold for $1,000 and earned a coupon payment of $80 during the year.The price of the bond at the end of the year dropped to $980.a. Calculate Kim’s investment return.b. Calculate Kim’s total dollar gain or loss on her investment.
The accompanying table shows the consumer price index for China, India, and the U.S. for 2018 and 2019, each using the base period of 2015. Compute the inflation rate for each country in 2019.Year China India U.S.2018 105.775 112.783 105.945 2019 108.841 121.422 107.865
Houses. The accompanying table shows a portion of the median sales price of new houses sold in the United States, along with the corresponding consumer price index (CPI).Year Price CPI 2010 221800 218.06 2011 227200 224.94⋮ ⋮ ⋮2019 321500 255.66a. Use the CPI to compute the real sales price
Income. Personal income is the income that people receive for labor, land, and capital along with the net current transfer payments that they receive from business and government.The accompanying table shows a portion of personal income (Income, measured in $ billions), along with the corresponding
Sales. Economists often look at retail sales data to gauge the state of the economy. The accompanying table shows a portion of seasonally adjusted monthly nominal retail sales for 2019, measured in $ millions. Also included in the table is the corresponding producer price index (PPI).Month Sales
The following table represents the nominal values of an item and the corresponding price index for three years.Year Nominal Value Price Index 1 38 100 2 40 103 3 42 112a. Compare the percentage change in the nominal values with the corresponding percentage change in real values from year 1 to year
The following table represents the nominal values of an item and the corresponding price index for two years.Year Nominal Value Price Index 1 38 112 2 40 120a. Compute the inflation rate for year 2.b. Compute the annual percentage change of the item in real terms.
The nominal values for four years are given by 32, 37, 39, and 42.Convert these values to real terms if the price index values for the corresponding years are given by 100, 102, 103, and 108.
The accompanying table shows the number of SaaS subscriptions for each type of usage for 2018, 2019, and 2020 described in the previous exercise. Use this information, along with the price data provided in the previous exercise, to solve the following problems. Assume that the base year is
A software company offers several pricing options for its software as a service (SaaS) product. SaaS is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted. The pricing options include limited, medium, and unlimited access for
The following table shows the number (in 1,000s) of breakfasts sold at JJ Diner. Use this information, along with the price data provided in the previous exercise, to solve the following problems.Assume that the base year is 2017.Year Omelet Pancakes Cereal 2017 9.26 7.98 2.44 2018 11.82 9.20 2.62
JJ Diner is a small mom and pop restaurant in a small town. They offer three choices for breakfast: omelets, pancakes, or cereal. The average prices (in $) for these options for 2017, 2018, and 2019 are shown in the accompanying table.Year Omelet Pancakes Cereal 2017 4.75 3.50 3.50 2018 5.25 4.25
A private college in Wisconsin offers an MBA program for executives.The following table shows the tuition for the program from 2014 to 2019.Year 2014 2015 2016 2017 2018 2019 Tuition (in $) 36,850 39,844 42,634 44,556 46,784 48,650a. Use 2014 as the base year to form a simple price index for
Returns. According to dollar cost averaging, a fixed amount of money is invested periodically in a portfolio. Consequently, more units of a financial asset are purchased when prices are low and fewer units are purchased when prices are high. Robert Dudek follows dollar cost averaging by making a
Tech. The accompanying table shows a portion of the monthly adjusted closing price per share of a technology firm.Month Jan Feb ⋯ Dec Price 16.6 15.8 ⋯ 30.3a. Construct a simple price index with January as the base.b. What is the percentage price change in July relative to January?c. What is
Gasoline The accompanying table shows a portion of the average monthly prices, for regular gasoline in 2019.($ per gallan)Month Jan Feb ⋯ Dec Price 2.34 2.39 ⋯ 2.65a. Construct a simple price index with January 2019 as the base.b. Determine the percentage change in the average gasoline price
Use the price and quantity information in the previous exercise to compute the following aggregate price indices, given a base year of 2018.a. The unweighted aggregate price indexb. The Laspeyres price indexc. The Paasche price index Applications
Consider the following price and quantity data for three products from 2018 to 2020.Year Product 1 Product 2 Product 3 2018 Price $14.30 $13.90 $18.10 Quantity 992 1,110 800 2019 Price $14.90 $13.70 $18.50 Quantity 980 1,220 790 2020 Price $15.50 $13.80 $17.90 Quantity 140 1,290 810a. Compute the
Exercise_19.11. The accompanying table shows a portion of the price data from 2012 to 2020.Year 2012 2013 ⋯ 2020 Price 62 60 ⋯ 70a. Compute the simple price index using 2012 as the base year.b. Determine the percentage change in prices from 2012 to 2016.
Exercise_19.10. The accompanying table shows a portion of the simple price index, using 2012 as the base year.Year 2012 2013 ⋯ 2020 Price Index 100 107.2 ⋯ 114.7a. Update the index numbers using a revised base year of 2016.b. Determine the percentage change in price from 2012 to 2020.c.
Consider the following adjusted closing stock prices for two software development firms. Compute and compare the monthly returns for both firms from January 2020 to May 2020.Date Firm 1 Firm 2 1/1/2020 12.36 36.61 2/1/2020 12.53 36.84 3/1/2020 11.64 35.36 4/1/2020 11.47 34.64 5/1/2020 11.12 33.93
Consider the following adjusted closing stock prices of a company.Find the monthly returns for January and February of 2020.January 1, 2020 36.82 February 1, 2020 36.20 March 1, 2020 36.07
Bill Anderson purchased 1,000 shares of a company’s stock for $17,100 at the beginning of 2019. At the end of the year, he sold all of his shares at $30.48 a share. He also earned a dividend of $0.52 per share during the year.a. What is Bill’s total return on the investment?b. What is the
A portfolio manager invested $1,500,000 in bonds.In one year, the market value of the bonds dropped to$1,485,000. The interest payments during the year totaled$105,000.a. What was the manager’s total rate of return for the year?b. What was the manager’s real rate of return if the inflation rate
The year-end price and dividend information on a stock is given in the following table.Year Price Dividend 1 23.50 NA 2 24.80 0.18 3 22.90 0.12 Note: NA denotes not applicable.a. What is the nominal return of the stock in years 2 and 3?b. What is the corresponding real return if the inflation rates
You bought a corporate bond last year for $980. You received a coupon payment (interest) of $60, and the bond is currently selling for $990. What is the (a) income yield, (b) capital gains yield, and (c) Investion return?
Consumption. The consumption function is one of the key relationships in economics, where consumption (y) depends on disposable income (x). The accompanying table shows a portion of quarterly data on personal consumption expenditure and disposable income for five years. Both variables are measured
Vehicle_Miles. The United States economy picked up speed in 2012 as businesses substantially built up their inventories and consumers increased their spending. This also led to an increase in domestic travel. The accompanying table shows a portion of the vehicle miles traveled in the U.S. (in

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ISE Business Statistics Communicating With Numbers 4th International Edition Sanjiv Jaggia, Alison Kelly - Solutions

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