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BUSI 1013: STATISTICS FOR BUSINESS

UNIT EXERCISES

Unit Exercise 1
 Due no later than 11:00 p.m. on Sunday of Unit 2
 Worth 4% of final grade
1. As the Manager of Customer service at a Bank, you were assigned the job of revamping the Customer
Service function at the branches. To get the project started, a research study at four branches was
conducted to assess the effectiveness of a recent change in the customer account management process.
Details of the study are as follows:
 A group of customers from each of the four branches were selected randomly and invited to
participate in the study.
 Personal deposit and loan balances from these customers were extracted from the Bank’s
databases before the change took place.
 Personal deposit and loan balances from these customers were also extracted from the Bank two
months after the change
 A simple survey was conducted to ask the customers involved about their experiences with the
change. A few variables from the survey were recorded and appended to the extracted deposit
and loan file.

The attached Excel workbook, BUSI1013 Bank Dataset.xlsx, contains the data collected from the research
study. (32 Points total; Part a.-d. 4 Points each, Part e. and f. 8 Points each)
Answer the following questions using this data set.
a. What would the population of interest be for this study?
b. Which method of sampling was used in this study?
c. How big is the sample size?
d. How many variables are in the data set?
e. Which of the variables are categorical?
f. Which of the variables are numerical?

2. Use a frequency distribution table to numerically summarize the variable Branch in the BUSI1013 Bank
Dataset.xlsx data set. Based on the table, use a pie chart to summarize this variable graphically. (10
Points total; 5 points each)

3. Data from the Chase branch is extracted from the data set BUSI Bank Dataset.xlsx and is stored in
BUSI1013 Chase Dataset.xlsx. Use this file to answer the following: (18 Points total; Part a. 8 Points, Part b
and c 5 Points each)
a. Construct a histogram for the variable income.
b. What does the histogram tell us about the shape of the distribution of age?
c. Construct a stem-and-leaf display for the variable age. Please be sure to include a leaf unit.

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4. Use the data in BUSI1013 Chase Dataset.xlsx to answer these questions: (40 Points in total; 5 Points
each)
a. What is the sample mean of the variable income?
b. What is the sample median of the variable income?
c. Find the range of the variable income.
d. Find the sample standard deviation of the variable income.
e. Compute the first and third quartile of the variable income
f. What is the IQR of the variable income?
g. Give the five-number summary for the variable income.
h. Use the IQR rule to determine whether there are outliers for the variable income.

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Unit Exercise 2
 Due no later than 11:00 p.m. on Sunday of Unit 4
 Worth 4% of final grade

1. What is wrong with the following statements? Explain your answer. (6 Points total; 2 Points each)
a. The probability that a student misses a class is 0.04 and the probability that he attends a class
is 0.9
b. P (A and B) = -0.2
c. P(A or B) = 0.7 if P(A) =0.4 and P(B) =0.3

2. Given that P(A)=0.64, P(B)=0.42 and P(A and B) = 0.3, calculate the following: (10 Points total; 5
Points each)
a. P(A or B)
b. P(A|B)

3. A company has 750 employees. 450 of the employees are females. Half the female are less than
thirty years old, and one-fourth of the male workers are less than thirty years old. If one of the
workers of the company is selected at random, what is the probability that the person selected
is less than thirty years old? (10 Points)

4. The following table shows profit for 150 companies in 4 different industries: (24 Points total; 4
Points each)

Less than or equal to 50 million More than 50 million Total

Auto Industry 17 15 32
Steel Industry 35 30 65
Food Industry 28 5 33
Wood Industry 10 10 20
Total 90 60 150

Assume we randomly choose a company, calculate the following probabilities

a. The company has a profit less than or equal to 50 million.
b. The company is from the auto industry.
c. The company is from the auto industry and has profit more than 50 million.
d. The company is either from the auto company or has a profit more than 50 million.
e. The company is from the auto industry given it has profit more than 50 million.
f. The company has a profit less than 50 million given it is not from the auto industry.

5. ABC Inc. is a large Canadian company with thousands of employees across the country. Its recent
study on employee engagement showed that 70% of the employees participated in the study
agreed with the statement that their managers provide them with the necessary support on a
consistent basis. The company believes that employees included in the study are representative

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of the entire employee base. Suppose that 18 employees are selected randomly from the
employee base, is the selection of 18 employees a binomial experiment? Please explain. (10
Points)

6. A recent survey found that 83% of Canadians were satisfied with their current jobs. Answer the
following questions based on a random sample of 10 Canadian workers: (20 Points total; 5
Points each)
a. What is the probability that exactly six employees were satisfied with their current jobs?
b. What is the probability that exactly nine employees were satisfied with their current jobs?
c. What is the probability that either four or five employees were satisfied with their current
jobs?
d. What are the mean and standard deviation for this distribution?

7. On average, you receive 3 junk emails every 6 hours. Assume that the number of pieces of junk mail
you receive each day follows the Poisson distribution. (20 Points total; 5 Points each)
a. What is the expected number of junk emails in one day?
b. What is the probability of receiving exactly two junk emails in a six-hour interval?
c. What is the probability of receiving less than two junk emails in a six-hour interval?
d. What is the probability of receiving two or more junk email in a six-hour interval?

Unit Exercise 3
 Due no later than 11:00 p.m. on Sunday of Unit 8
 Worth 4% of final grade

8. In a recent utilization of the survey of an e-learning platform of a post-secondary institution, a

random sample of 64 students is selected (out of a population of 5000 students). Their weekly
hours of using this platform to perform learning activities are collected. After analyzing the data,
a researcher states that he is 95% confident that the mean hours of the 5000 students is
between 36.2 and 40.8 hours.
Explain the meaning of the statement reported by the researcher. (5 Points)

9. The property manager of a shopping mall claims that the mean score of their customer service is at
least 85. Twenty-five customers were randomly selected to evaluate the customer service of the
mall. The analysis via a hypothesis test shows that the P-value is less than 0.002 (i.e. p < 0.002).
(15 Points; 5 Points each)

a. State the null and alternative hypotheses.

b. Which distribution, normal or Student’s t-distribution, is more appropriate for the hypothesis
test? Why?
c. Explain the results of the hypothesis test in a way that could be understood by someone who
has not studied statistics.

10. A simple random sample of 120 items is taken from an inventory and the average unit cost on the
items is $25. The population standard deviation σ is known to be $10.50. (20 Points Total; 5
Point each)

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a. Construct a 95% confidence interval for the mean unit cost of the population.
b. What is the margin of error at the 90% confidence level?
c. Construct a 95% confidence interval for the mean unit cost of the population if the sample
unit cost is obtained from a random sample of 200 instead of 120.
d. Based on the results from a. and c., what can you say about the effect of a larger sample size
on the length of the confidence interval at the same confidence level?

11. A statistician argues when sample size is big enough, the probability that the mean of the sample
be higher than the mean of the population is the same as the probability that the mean of the
sample be lower than the mean of population. Do you agree or disagree? Discuss your answer.
(5 Points)

12. A simple random sample of 25 movies is taken from a movie website and the average lengths of
them are found to be 150 min. The population standard deviation σ is known to be 10 min. (20
Points; 10 Points each)

a. Test the hypothesis that the population mean length is greater than 145 min using the 0.05
level of significance.
b. Test the hypothesis that the population mean of movie length is different from 155 min using
a 0.05 level of significance.

13. The Ministry of health in BC wants to compare the average amount of time people spent in Stanley
Park versus English Bay during peak times to implement effective safety measures for COVID-19.
A random sample of 25 persons in the Stanley Park spent an average of 14.6 minutes with a
sample standard deviation of 5.8 minutes. A random sample of 27 persons in the English Bay
spent an average of 11.5 minutes with a sample standard deviation of 4.9 minutes.
Perform a hypothesis test using α = 0.05 to determine if the average time people spent in Stanley Park
is more than the average time people spent in the English Bay. (15 Points)

14. In a completely randomized design, 7 experimental units were used for each of the three levels of
the factor. (20 Points)

Source of Sum of Degrees of Mean Square F

Variation Squares Freedom
Treatment
Error 432076.5
Total 675643.3

a. Complete the ANOVA table. (8 Points)

b. Find the critical value at the 0.05 level of significance from the F-table for testing whether the
population means for the three levels of the factors are different. (6 Points)

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c. Use the critical value approach and α = 0.05 to test whether the population means for the
three levels of the factors are the same. (6 Points)

Unit Exercise 3
 Due no later than 11:00 p.m. on Sunday of Unit 8
 Worth 4% of final grade

15. In a recent utilization of the survey of an e-learning platform of a post-secondary institution, a

random sample of 64 students is selected (out of a population of 5000 students). Their weekly
hours of using this platform to perform learning activities are collected. After analyzing the data,
a researcher states that he is 95% confident that the mean hours of the 5000 students is
between 36.2 and 40.8 hours.
Explain the meaning of the statement reported by the researcher. (5 Points)

16. The property manager of a shopping mall claims that the mean score of their customer service is at
least 85. Twenty-five customers were randomly selected to evaluate the customer service of the
mall. The analysis via a hypothesis test shows that the P-value is less than 0.002 (i.e. p < 0.002).
(15 Points; 5 Points each)

a. State the null and alternative hypotheses.

b. Which distribution, normal or Student’s t-distribution, is more appropriate for the hypothesis
test? Why?
c. Explain the results of the hypothesis test in a way that could be understood by someone who
has not studied statistics.

17. A simple random sample of 120 items is taken from an inventory and the average unit cost on the
items is $25. The population standard deviation σ is known to be $10.50. (20 Points Total; 5
Point each)
a. Construct a 95% confidence interval for the mean unit cost of the population.
b. What is the margin of error at the 90% confidence level?
c. Construct a 95% confidence interval for the mean unit cost of the population if the sample
unit cost is obtained from a random sample of 200 instead of 120.
d. Based on the results from a. and c., what can you say about the effect of a larger sample size
on the length of the confidence interval at the same confidence level?

18. A statistician argues when sample size is big enough, the probability that the mean of the sample
be higher than the mean of the population is the same as the probability that the mean of the
sample be lower than the mean of population. Do you agree or disagree? Discuss your answer.
(5 Points)

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19. A simple random sample of 25 movies is taken from a movie website and the average lengths of
them are found to be 150 min. The population standard deviation σ is known to be 10 min. (20
Points; 10 Points each)

a. Test the hypothesis that the population mean length is greater than 145 min using the 0.05
level of significance.
b. Test the hypothesis that the population mean of movie length is different from 155 min using
a 0.05 level of significance.

20. The Ministry of health in BC wants to compare the average amount of time people spent in Stanley
Park versus English Bay during peak times to implement effective safety measures for COVID-19.
A random sample of 25 persons in the Stanley Park spent an average of 14.6 minutes with a
sample standard deviation of 5.8 minutes. A random sample of 27 persons in the English Bay
spent an average of 11.5 minutes with a sample standard deviation of 4.9 minutes.
Perform a hypothesis test using α = 0.05 to determine if the average time people spent in Stanley Park
is more than the average time people spent in the English Bay. (15 Points)

21. In a completely randomized design, 7 experimental units were used for each of the three levels of
the factor. (20 Points)

Source of Sum of Degrees of Mean Square F

Variation Squares Freedom
Treatment
Error 432076.5
Total 675643.3

a. Complete the ANOVA table. (8 Points)

b. Find the critical value at the 0.05 level of significance from the F-table for testing whether the
population means for the three levels of the factors are different. (6 Points)

c. Use the critical value approach and α = 0.05 to test whether the population means for the
three levels of the factors are the same. (6 Points)

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BUSI 1013 STATISTICS FOR BUSINESS 8