MS1023 Business Statistics with Computer Applications Homework #1 MCQs

| August 30, 2017

Question
MS1023 Business Statistics with Computer Applications Homework #1

1. Sue Taylor, Director of Global Industrial
Sales, is concerned by a deteriorating sales
trend. Specifically, the number of industrial
customers is stable at 1,500, but they are
purchasing less each year. She orders her
staff to search for causes of the downward
trend by surveying all 1,500 industrial
customers. For this study, the set of 1,500
industrial customers is ______________.
a) a parameter
b) a sample
c) the population
d) a statistic
e) the frame
2. Sue Taylor, Director of Global Industrial
Sales, is concerned by a deteriorating sales
trend. Specifically, the number of industrial
customers is stable at 1,500, but they are
purchasing less each year. She orders her
staff to search for causes of the downward
trend by selecting a focus group of 40
industrial customers. For this study, the set
of 40 industrial customers is ________.
a) a parameter
b) a sample
c) the population
d) a statistic
e) the frame
3. Sue Taylor, Director of Global Industrial
Sales, is concerned by a deteriorating sales
trend. Specifically, the number of customers
is stable at 1,500, but they are purchasing
less each year. She orders her staff to
search for causes of the downward trend by
surveying all 1,500 industrial customers.
Sue is ordering a __________.
a) statistic from the industrial customers
b) census of the industrial customers
c) sample of the industrial customers
d) sorting of the industrial customers
e) parameter of the industrial customers
4. Sue Taylor, Director of Global Industrial
Sales, is concerned by a deteriorating sales
trend. Specifically, the number of customers
is stable at 1,500, but they are purchasing
less each year.
She orders her staff to search for causes of
the downward trend by surveying all 1,500
industrial customers. One question on the
survey asked the customers: “Which of the
following best describes your primary
business: a. manufacturing, b. wholesaler,
c. retail, d. service.” The measurement
level for this question is
_________________.
a) interval level
b) ordinal level
c) nominal level
d) ratio level
e) relative level
5. Which scale of measurement has these
two properties: linear distance is meaningful
and the location of origin (or zero point) is
arbitrary?
a) Interval level
b) Ordinal level
c) Nominal level
d) Ratio level
e) Minimal level
6. Which scale of measurement has these
two properties: linear distance is
meaningful and the location of origin (or
zero point) is absolute (or natural)?
a) Interval level
b) Ordinal level
c) Nominal level
d) Ratio level
e) Relative level
7. Which of the following operations is
meaningful for processing nominal data?
a) Addition
b) Multiplication
c) Ranking
d) Counting
e) Division
MS1023 Business Statistics with Computer Applications Homework #1

8. Which of the following operations is
meaningful for processing ordinal data, but
is meaningless for processing nominal
data?
a) Addition
b) Multiplication
c) Ranking
d) Counting
e) Division
9. The social security number of employees
would be an example of what level of data
measurement?
a) Interval level data
b) Ordinal level data
c) Nominal level data
d) Ratio level data
e) Relative level data
10. Sales of a restaurant (in dollars) are an
example of what level of data
measurement?
a) Interval level data
b) Ordinal level data
c) Nominal level data
d) Ratio level data
e) Relative level data
11. A market researcher is interested in
determining the average income for families
in Bexar County, San Antonio. To
accomplish this, she takes a random
sample of 400 families from the county and
uses the data gathered from them to
estimate the average income for families of
the entire county. This process is an
example of _______.
a) nonparametric statistics
b) nominal data
c) descriptive statistics
d) inferential statistics
e) census
12. The Magnolia Swimming Pool Company
wants to determine the average number of
years it takes before a major repair is
required on one of the pools that the
company constructs. The president of the
company asks Rick Johnson, a company
accountant, to randomly contact fifty
families that built Magnolia pools in the past
ten years and determine how long it was in
each case until a major repair. The
information will then be used to estimate the
average number of years until a major
repair for all pools sold by Magnolia. The
average based on the data gathered from
the fifty families can best be described as a
_______.
a) parameter
b) sample
c) population
d) statistic
e) frame
13. What proportion of San Diego’s
registered voters favor trade restrictions
with China? In an effort to determine this, a
research team calls every registered voter
in San Diego and contacts them. The
proportion determined from the data
gathered is a _______.
a) parameter
b) sample
c) population
d) statistic
e) frame
14. Jessica Salas, president of Salas
Products, is reviewing the warranty policy
for her company’s new model of automobile
batteries. Life tests performed on a sample
of 100 batteries indicated: (1) an average
life of 75 months, (2) a standard deviation of
5 months, and (3) a bell shaped battery life
distribution. Approximately 68% of the
batteries will last between
________________.
a) 70 and 80 months
b) 60 and 90 months
c) 65 and 85 months
d) 55 and 95 months
e) 60 and 100 months
MS1023 Business Statistics with Computer Applications Homework #1

15. Jessica Salas, president of Salas
Products, is reviewing the warranty policy
for her company’s new model of automobile
batteries. Life tests performed on a sample
of 100 batteries indicated: (1) an average
life of 75 months, (2) a standard deviation of
5 months, and (3) a bell shaped battery life
distribution. Approximately 95% of the
batteries will last between
________________.
a) 70 and 80 months
b) 60 and 90 months
c) 65 and 85 months
d) 55 and 95 months
e) 60 and 100 months
16. Jessica Salas, president of Salas
Products, is reviewing the warranty policy
for her company’s new model of automobile
batteries. Life tests performed on a sample
of 100 batteries indicated: (1) an average
life of 75 months, (2) a standard deviation of
5 months, and (3) a bell shaped battery life
distribution. Approximately 99.7% of the
batteries will last between
________________.
a) 70 and 80 months
b) 60 and 90 months
c) 65 and 85 months
d) 55 and 95 months
e) 50 and 100 months
17. Jessica Salas, president of Salas
Products, is reviewing the warranty policy
for her company’s new model of automobile
batteries. Life tests performed on a sample
of 100 batteries indicated: (1) an average
life of 75 months, (2) a standard deviation of
5 months, and (3) a bell shaped battery life
distribution. What percentage of the
batteries will fail within the first 65 months of
use?
a) 0.5%
b) 1%
c) 2.5%
d) 5%
e) 7.5%
18. An instructor is evaluating the
performance of students on a test. He
records the number of points that each
student missed and created a frequency
distribution. This is provided below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the mean number of points missed?
a) 20
b) 25
c) 29
d) 30
e) 35
19. An instructor is evaluating the
performance of students on a test. He
records the number of points that each
student missed and created a frequency
distribution. This is provided below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the standard deviation for this
population?
a) 11.43
b) 14.14
c) 12.63
d) 13.17
e) 16.90
MS1023 Business Statistics with Computer Applications Homework #1

20. An instructor is evaluating the
performance of students on a test. He
records the number of points that each
student missed and created a frequency
distribution. This is provided below:
Points missed Number of students
0-under 10 2
10-under 20 4
20-under 30 10
30-under 40 8
40-under 50 6
What is the variance for this population?
a) 11.43
b) 135.17
c) 130.67
d) 180.67
e) 198.07
21. The following box and whisker plot was
constructed for the age of accounts
receivable.
The box and whisker plot reveals that the
accounts receivable ages are _______.
a) skewed to the left
b) skewed to the right
c) not skewed
d) normally distributed
e) symmetrical
22. A sample was taken of the salaries of
four employees from a large company. The
following are their salaries (in thousands of
dollars) for this year: 33, 40, 25, and 45.
The median of their salaries is
approximately
a) 36.5
b) 32.5
c) 40
d) 35.75
e) 25
23. A sample was taken of the salaries of
four employees from a large company. The
following are their salaries (in thousands of
dollars) for this year: 33, 40, 25, and 45. The
variance of their salaries is approximately
a) 56.69
b) 75.58
c) 227.75
d) 35.75
e) 8.7
24. Pinky Bauer, Chief Financial Officer of
Harrison Haulers, Inc., suspects
irregularities in the payroll system, and
orders an inspection of “each and every
payroll voucher issued since January 1,
1993.” Each payroll voucher was inspected
and the following frequency distribution was
compiled.
Errors per Voucher Number of Vouchers
0-under 2 500
2-under 4 400
4-under 6 300
6-under 8 200
8-under 10 100
The median number of errors per voucher is
__________.
a) 3.67
b) 5
c) 3.25
d) 400
e) 3
The number of phone calls arriving at a
switchboard each hour has been recorded,
and the following frequency distribution has
been developed.
Class Interval Frequency
20-under 40 30
40-under 60 45
60-under 80 80
80-under 100 45
Answer the questions 25-27 based on
above information.
MS1023 Business Statistics with Computer Applications Homework #1

25. What is the midpoint of the last class?
a) 80
b) 100
c) 95
d) 90
e) 85
26. What is the relative frequency of the
second class?
a) 0.455
b) 0.900
c) 0.225
d) 0.750
e) 0.725
27. What is the cumulative frequency of the
third class?
a) 80
b) 0.40
c) 155
d) 75
e) 105
Consider the following stem and leaf plot:
Stem Leaf
1 0, 2, 5, 7
2 2, 3, 4, 8
3 0, 4, 6, 6, 9
4 5, 8, 8, 9
5 2, 7, 8
Suppose that a frequency distribution was
developed from this, and there were 5
classes (10-under 20, 20-under 30, etc.).
Answer the questions 28-30 based on
above information.
28. What was the highest number in the
data set?
a) 50
b) 58
c) 59
d) 78
e) 98
29. What was the lowest number in the data
set?
a) 0
b) 10
c) 7
d) 2
e) 1
30. What is the cumulative frequency for the
30-under 40 class interval?
a) 5
b) 9
c) 13
d) 14
e) 18
31. A person has decided to construct a
frequency distribution for a set of data
containing 60 numbers. The lowest number
is 23 and the highest number is 68. If 7
classes are used, the class width should be
approximately _______.
a) 5
b) 7
c) 9
d) 11
e) 12
32. The following class intervals for a
frequency distribution were developed to
provide information regarding the starting
salaries for students graduating from a
particular school:
Salary Number of Graduates
($1,000s)
18-under 21 –
21-under 25 –
24-under 27 –
29-under 30 –
Before data was collected, someone
questioned the validity of this arrangement.
Which of the following represents a problem
with this set of intervals?
a) There are too many intervals.
b) The class widths are too small.
c) Some numbers between 18,000 and
30,000 would fall into two different
intervals.
d) The first and the second interval overlap.
e) There are too few intervals.
MS1023 Business Statistics with Computer Applications Homework #1

Each day, the office staff at Oasis Quick
Shop prepares a frequency distribution and
an ogive of sales transactions by dollar
value of the transactions. Saturday’s
cumulative frequency ogive follows.
Answer the questions 33-35 based on
above information.
33. The percentage of sales transactions on
Saturday that were under $100 each was
_____________.
a) 100
b) 10
c) 80
d) 20
e) 15
34. The percentage of sales transactions on
Saturday that were at least $100 each was
_____________.
a) 100
b) 10
c) 80
d) 20
e) 15
35. The percentage of sales transactions on
Saturday that were between $100 and $150
was _____________.
a) 20%
b) 40%
c) 60%
d) 80%
e) 10%
36. The following graphic of residential
housing data (selling price and size in
square feet) is a _____________.
a) scatter plot
b) Pareto chart
c) pie chart
d) cumulative histogram
e) cumulative frequency distribuion
37. The following graphic of residential
housing data (selling price and size in
square feet) indicates _____________.
a) an inverse relation between the two
variables
b) no relation between the two variables
c) a direct relation between the two
variables
d) a negative exponential relation between
the two variables
e) a non-linear relationship between the two
variables
70
80
90
100
110
120
130
1400 1600 1800 2000 2200 2400
Square Feet
Selling Price ($1,000)
70
80
90
100
110
120
130
1400 1600 1800 2000 2200 2400
Square Feet
Selling Price ($1,000)
MS1023 Business Statistics with Computer Applications Homework #1

38. The following graphic of cigarettes
smoked (sold) per capita (CIG) and deaths
per 100K population from lung cancer
(LUNG) indicates _________
10 15 20 25 30 35 40 45
28
26
24
22
20
18
16
14
12
10
CIG
LUNG
Scatterplot of LUNG vs CIG
a) a weak relation between the two
variables
b) a pretty strong relation between the two
variables
c) when the number of cigarettes smoked
(sold) per capita (CIG) increases the deaths
per 100K population from lung cancer
(LUNG) decreases
d) a negative relation between the two
variables
e) no relation between the two variables
39. Belinda Bose is reviewing a newly
proposed advertising campaign. Based on
her 15 years of experience, she believes the
campaign has a 75% chance of significantly
increasing brand name recognition of the
product. This is an example of assigning
probabilities using the ________________
method.
a) subjective probability
b) relative frequency
c) classical probability
d) a priori probability
e) a posterior probability
40. Which of the following is not a legitimate
probability value?
a) 0.67
b) 15/16
c) 0.23
d) 4/3
e) 0.98
41. Which of the following is not a legitimate
probability value?
a) 0.67
b) 15/16
c) 0.23
d) 2/3
e) -0.28
42. The list of all elementary events for an
experiment is called _______.
a) the sample space
b) the exhaustive list
c) the population space
d) the event union
e) a frame
43. In a set of 15 aluminum castings, two
castings are defective (D), and the
remaining thirteen are good (G). A quality
control inspector randomly selects three of
the fifteen castings without replacement,
and classifies each as defective (D) or good
(G). The sample space for this experiment
contains ____________ elementary events.
a) 3,375
b) 2,730
c) 455
d) 15
e) 3
44. In a set of 10 aluminum castings, two
castings are defective (D), and the
remaining eight are good (G). A quality
control inspector randomly selects three of
the ten castings with replacement, and
classifies each as defective (D) or good (G).
The sample space for this experiment
contains __________ elementary events.
a) 1,000
b) 720
c) 100
d) 10
e) 3
MS1023 Business Statistics with Computer Applications Homework #1

Consider the following sample space, S,
and several events defined on it. S =
{Albert, Betty, Abel, Jack, Patty, Meagan},
and the events are: F = {Betty, Patty,
Meagan}, H = {Abel, Meagan}, and P =
{Betty, Abel}.
Answer questions 45-47 based on above
information.
45. F ? H is ___________.
a) {Meagan}
b) {Betty, Patty, Abel, Meagan}
c) empty, since F and H are complements
d) empty, since F and H are independent
e) empty, since F and H are mutually
exclusive
46. F ? H is ___________.
a) {Meagan}
b) {Betty, Abel, Patty, Meagan}
c) empty, since F and H are complements
d) empty, since F and H are independent
e) empty, since F and H are mutually
exclusive
47. The complement of F is ___________.
a) {Albert, Betty, Jack, Patty}
b) {Betty, Patty, Meagan}
c) {Albert, Abel, Jack}
d) {Betty, Abel}
e) {Meagan}
Let A be the event that a student is enrolled
in an accounting course, and let S be the
event that a student is enrolled in a statistics
course. It is known that 30% of all students
are enrolled in an accounting course and
40% of all students are enrolled in statistics.
Included in these numbers are 15% who are
enrolled in both statistics and accounting.
Answer questions 48-51 based on above
information.
48. Find P(S).
a) 0.15
b) 0.30
c) 0.40
d) 0.55
e) 0.60
49. Find the probability that a student is in
accounting and is also in statistics.
a) 0.15
b) 0.70
c) 0.55
d) 0.12
e) 0.60
50. A student is randomly selected, and it is
found that the student is enrolled in
accounting. What is the probability that this
student is also enrolled in statistics?
a) 0.15
b) 0.75
c) 0.375
d) 0.50
e) 0.80
51. A student is randomly selected, what is
the probability that the student is enrolled in
either accounting or statistics or both?
a) 0.15
b) 0.85
c) 0.70
d) 0.55
e) 0.90
Abel Alonzo, Director of Human Resources,
is exploring employee absenteeism at the
Plano Power Plant. Ten percent of all plant
employees work in the finishing department;
20% of all plant employees are absent
excessively; and 7% of all plant employees
work in the finishing department and are
absent excessively. A plant employee is
selected randomly; F is the event “works in
the finishing department;” and A is the event
“is absent excessively.”
Answer the questions 52-54 based on
above information.
52. P(A ? F) = _____________.
a) 0.07
b) 0.10
MS1023 Business Statistics with Computer Applications Homework #1

c) 0.20
d) 0.23
e) 0.37
53. P(A|F) = _____________.
a) 0.37
b) 0.70
c) 0.13
d) 0.35
e) 0.80
54. P(F|A) = _____________.
a) 0.35
b) 0.70
c) 0.13
d) 0.37
e) 0.10
A market research firm is investigating the
appeal of three package designs. The table
below gives information obtained through a
sample of 200 consumers. The three
package designs are labeled A, B, and C.
The consumers are classified according to
age and package design preference.
A B C Total
Under 25 years 22 34 40 96
25 or older 54 28 22 104
Total 76 62 62 200
Answer the questions 55-58 based on
above information.
55. If one of these consumers is randomly
selected, what is the probability that the
person prefers design A?
a) 0.76
b) 0.38
c) 0.33
d) 0.22
e) 0.39
56. If one of these consumers is randomly
selected, what is the probability that the
person prefers design A and is under 25?
a) 0.22
b) 0.11
c) 0.18
d) 0.54
e) 0.78
57. If one of these consumers is randomly
selected and is under 25, what is the
probability that the person prefers design A?
a) 0.22
b) 0.23
c) 0.29
d) 0.18
e) 0.78
58. If one of these consumers is randomly
selected and prefers design B, what is the
probability that the person is 25 or older?
a) 0.28
b) 0.14
c) 0.45
d) 0.27
e) 0.78
59. Are “B” and “25 or older” independent
and why or why not?
a) No, because P (25 or over | B) ? P (B)
b) Yes, because P (B) = P(C)
c) No, because P (25 or older | B) ? P (25 or
older)
d) Yes, because P (25 or older ? B) ? 0
e) No, because age and package design
are different things
60. A market research firms conducts
studies regarding the success of new
products. The company is not always
perfect in predicting the success. Suppose
that there is a 50% chance that any new
product would be successful (and a 50%
chance that it would fail). In the past, for all
new products that ultimately were
successful, 80% were predicted to be
successful (and the other 20% were
inaccurately predicted to be failures). Also,
for all new products that were ultimately
failures, 70% were predicted to be failures
(and the other 30% were inaccurately
predicted to be successes). For any
randomly selected new product, what is the
MS1023 Business Statistics with Computer Applications Homework #1

probability that the market research firm
would predict that it would be a success?
a) 0.80
b) 0.50
c) 0.45
d) 0.55
e) 0.95
Everyone is familiar with waiting lines or
queues. For example, people wait in line at a
supermarket to go through the checkout
counter. There are two factors that determine
how long the queue becomes. One is the
speed of service. The other is the number of
arrivals at the checkout counter. The mean
number of arrivals is an important summary
statistic, but so is the standard deviation. A
consultant working for the supermarket
counted the number of arrivals (shown
below) per hour during a sample of 30 hours.
106 99 109 130 105
97 115 75 84 95
103 111 102 72 98
132 106 94 71 93
91 84 94 88 101
89 101 90 107 98
Answer the questions 61-63 based on
above information.
61. The mean is ___________.
a) 2,940
b) 30
c) 98
d) 13.86
e) 14.098
62. The standard deviation is ___________.
a) 14.098
b) 13.86
c) 192.13
d) 2,940
e) 198.76
63. Assuming data is normally distributed
(i.e. histogram is bell shaped) and given the
mean and standard deviation calculated,
usually what range of number of arrivals do
you expect for this supermarket?
(Remember “usually” means 95% of the
time).
a) 84 to 112
b) 70 to 126
c) 56 to 140
d) 71 to 132
e) 70 to 162
The following sets of sample data represent
the distribution of house prices in two
counties.
Price Range ($000s) No. of
houses in
Barsetshire
sample
No. of
houses in
Cokeshire
sample
65 but under 70 2 4
70 but under 75 5 11
75 but under 80 12 19
80 but under 90 20 15
90 but under 110 14 6
110 but under 140 6 4
140 but under 200 1 1
Answer the questions 64-69 based on
above information.
64. The average house price ($000s) in
Barsetshire is ___________.
a) 92.790
b) 97.092
c) 99.702
d) 90.792
e) 84.750
65. The average house price ($000s) in
Cokeshire is ___________.
a) 84.750
b) 90.792
c) 84.570
d) 84.507
e) 85.470
MS1023 Business Statistics with Computer Applications Homework #1

66. The standard deviation for house prices
($000s) in Barsetshire is ___________.
a) 18.426
b) 18.272
c) 18.246
d) 18.227
e) 18.642
67. The standard deviation for house prices
($000s) in Cokeshire is ___________.
a) 17.788
b) 17.938
c) 18.426
d) 18.272
e) 17.878
68. Which of the following statements is
true?
a) House prices are higher in Cokeshire
b) House prices are lower in Barsetshire
c) House prices vary more in Barsetshire
d) House prices are the same in both
e) None of the above
69. Are summary statistics such as mean
and standard deviation appropriate
measures for this data set? Why or why
not?
a) No, there are too many intervals.
b) Yes, the class widths are all the same.
c) No, the class intervals are not the same
d) No, there are too few intervals.
e) Yes, data are distributed evenly.
Demand for consumer goods is necessarily
variable. Forecasting the demand for
consumer goods is an important business
activity, as all businesses have to plan
ahead. Manufacturer of consumer goods
has been studying the demand for one of
their products and the level of demand is
given in the following stem and leaf plot,
where stem unit is 100 and leaf unit is 10.
STEM LEAF
1 1 2 3 4.5 5 6 7 7 9 9.5
2 0 0 0 0 0 0 0 0 1 1 2 4 5 7 9
3 0 0 0 2 8
4
5 0
6
7
8 0
9
10
11
12 0
Answer the questions 70-79 based on
above information.
70. The mean is _____________.
a) 270.61
b) 27.61
c) 2700.61
d) 2.7061
e) 260.71
71. The standard deviation is __________.
a) 207.974
b) 206.591
c) 209.794
d) 204.977
e) 205.691
72. The median is _____________.
a) 200 and 300
b) 300
c) 210 and 300
d) 200
e) 200 and 210
73. The lower quartile is _________.
a) 110
b) 115
c) 180
d) 200
e) 295
MS1023 Business Statistics with Computer Applications Homework #1

74. The upper quartile is _________.
a) 110
b) 115
c) 180
d) 200
e) 295
75. The inter quartile range is _________.
a) 115
b) 110
c) 95
d) 20
e) 1090
76. The inner fences are ___________.
a) 7.5 to 640
b) -165 to 467.5
c) 467.5 to 640
d) 7.5 to 467.5
e) 110 to 1200
77. The outer fences are ___________.
a) 7.5 to 640
b) -165 to 467.5
c) 467.5 to 640
d) 7.5 to 467.5
e) -165 to 640
78. The mild outliers are ___________.
a) 500 only
b) 380 & 500
c) 500; 800 and 1200
d) 800 and 1200
e) No mild outliers
79. The serious outliers are ___________.
a) 500 only
b) 380 & 500
c) 500; 800 and 1200
d) 800 and 1200
e) No serious outliers
80. A company’s customer service 800
telephone system is set up so that the caller
has six options. Each of these six options
leads to a menu with four options. For each
of these four options, three more options
are available. For each of these three
options, another three options are
presented. If a person calls the 800 number
for assistance, how many total options are
possible?
a) 6
b) 24
c) 72
d) 216
e) 480
A survey conducted by the Northwestern
University Lindquist-Endicott Report asked
320 companies about the procedures they
use in hiring. Only 54% of the responding
companies review the applicant’s college
transcript as part of the hiring process, and
only 44% consider faculty references.
Assume that these percentages are true for
the population of companies in the United
States and that 35% of all companies use
both the applicant’s college transcript and
faculty references.
Answer the questions 81-83 based on
above information.
81. What is the probability that a randomly
selected company uses either faculty
references or college transcript as part of
the hiring process?
a) 0.44
b) 0.54
c) 0.63
d) 0.37
e) 0.35
82. What is the probability that a randomly
selected company uses either faculty
references or college transcript but not both
as part of the hiring process?
a) 0.09
b) 0.19
c) 0.63
d) 0.35
e) 0.28
MS1023 Business Statistics with Computer Applications Homework #1

83. What is the probability that a randomly
selected company uses neither faculty
references nor college transcript as part of
the hiring process?
a) 0.37
b) 0.35
c) 0.63
d) 0.28
e) 0.19
According to the Consumer Electronics
Manufacturers Association, 10% of all U.S.
households have a fax machine and 52%
have a personal computer. Suppose 91% of
all U.S. households having a fax machine
have a personal computer. A U.S.
household is randomly selected.
Answer the questions 84-88 based on
above information.
84. What is the probability that the
household has a fax machine and a
personal computer?
a) 0.091
b) 0.009
c) 0.10
d) 0.91
e) 0.62
85. What is the probability that the
household has a fax machine or a personal
computer?
a) 0.52
b) 0.10
c) 0.529
d) 0.091
e) 0.429
86. What is the probability that the
household has a fax machine and does not
have a personal computer?
a) 0.009
b) 0.471
c) 0.48
d) 0.10
e) 0.58
87. What is the probability that the
household has neither a fax machine nor a
personal computer?
a) 0.471
b) 0.009
c) 0.429
d) 0.091
e) 0.52
88. What is the probability that the
household does not have a fax machine and
does have a personal computer?
a) 0.471
b) 0.009
c) 0.429
d) 0.091
e) 0.52
In a recent year, business failures in the
United States numbered 83,384, according
to Dun & Bradstreet. The construction
industry accounted for 10,867 of these
business failures. The South Atlantic states
accounted for 8,010 of the business failures.
Suppose that 1,258 of all business failures
were construction businesses located in the
South Atlantic states. A failed business is
randomly selected from this list of business
failures.
Answer the questions 89-94 based on
above information.
89. What is the probability that the business
is located in the South Atlantic states?
a) 0.13032
b) 0.21130
c) 0.09606
d) 0.01509
e) 0.90606
MS1023 Business Statistics with Computer Applications Homework #1

90. What is the probability that the business
is in the construction industry or located in
the South Atlantic states?
a) 0.13032
b) 0.21130
c) 0.09606
d) 0.01509
e) 0.90606
91. What is the probability that the business
is in the construction industry if it is known
that the business is located in the South
Atlantic states?
a) 0.13032
b) 0.21130
c) 0.09606
d) 0.01509
e) 0.15705
92. What is the probability that the business
is located in the South Atlantic states if it is
known that the business is a construction
business?
a) 0.11576
b) 0.21132
c) 0.13032
d) 0.01509
e) 0.90606
93. What is the probability that the business
is not located in the South Atlantic states if it
is known that the business is not a
construction business?
a) 0.21132
b) 0.86968
c) 0.0961
d) 0.0151
e) 0.9069
94. Given that the business is a construction
business, what is the probability that the
business is not located in the South Atlantic
states?
a) 0.13032
b) 0.86968
c) 0.8842
d) 0.0151
e) 0.9069
In a certain city, 30% of the families have a
MasterCard, 20% have an American
Express card, and 25% have a Visa card.
Eight percent of the families have both a
MasterCard and an American Express card.
Twelve percent have both a Visa card and a
MasterCard. Six percent have both an
American Express card and a Visa card.
Answer the questions 84-88 based on
above information.
95. What is the probability of selecting a
family that has either a Visa card or an
American Express card?
a) 0.25
b) 0.20
c) 0.39
d) 0.37
e) 0.33
96. What is the probability of selecting a
family that has either a Visa card or a
MasterCard?
a) 0.25
b) 0.30
c) 0.55
d) 0.43
e) 0.12
97. If a family has a MasterCard, what is the
probability that it has a Visa card?
a) 0.40
b) 0.12
c) 0.30
d) 0.20
e) 0.48
MS1023 Business Statistics with Computer Applications Homework #1

98. If a family has a Visa card, what is the
probability that it has a MasterCard?
a) 0.25
b) 0.12
c) 0.39
d) 0.48
e) 0.40
99. Is possession of a Visa card
independent of possession of a
MasterCard? Why or why not?
a) No, because P (M | V) ? P (V)
b) Yes, because P (M) = P(V)
c) No, because P (V | M) ? P (V)
d) Yes, because P (V ? M) ? 0
e) No, because Visa and MasterCard are
different things
100. Is possession of an American Express
card mutually exclusive of possession of a
Visa card? Why or why not?
a) No, because P (A ? V) ? .0000
b) Yes, because P (A ? V) = .0000
c) No, because P (A ? V) ? P (V)
d) Yes, because P (V ? A) ? P (A)
e) No, because American Express and Visa
card are different things

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