Final Practice Questions
A z-score of 1.0 means that ________. the observation is 1.0 standard deviation to the right of the mean the observation is -1.0 standard deviation to the left of the mean the observation is -1.0 standard deviation to the right of the mean the observation has no deviation from the mean
A
Following are the components of a data set containing purchase details of a shoe manufacturing company. Identify the ratio data. Item cost Arrival Date Item Number Rank of suppliers
A
To construct a frequency distribution for categorical data, the: number of observations that appear in each category must be counted. number of observations in each category must be divided by the total number of observations in all categories. observations in each category must be multiplied by observations in the corresponding category. observations that appear in each category must be summed up
A
Type II error occurs when the test: incorrectly fails to reject an actually false null hypothesis. incorrectly rejects an actually true null hypothesis. correctly rejects an actually false null hypothesis. correctly fails to reject an actually true null hypothesis
A
Which decision model incorporates the uncertainty element? predictive descriptive normative prescriptive
A
Which of the following is true when testing for normality of errors? Normality is verified by inspecting for a bell-shaped distribution. Errors are normally distributed when the scatter diagram shows a straight-line distribution. It is easier to evaluate normality with small sample sizes. A scatter diagram of the whole data is always used to verify normality.
A
________ sampling applies to populations that are divided into natural subsets and allocates the appropriate proportion of samples to each subset. Stratified Systematic Continuous process Cluster
A
Descriptive analytics: helps detect hidden patterns in large quantities of data to group data into sets to predict behavior. helps companies classify their customers into segments to develop specific marketing campaigns. can predict risk and find relationships in data not readily apparent with traditional analyses. can use mathematical techniques with optimization to make decisions that take into account the uncertainty in the data.
B
Descriptive decision models: help analyze the risks associated with various decisions. describe relationships but do not tell a manager what to do. do not facilitate evaluation of different decisions. aim to predict what will happen in the future
B
Robin Inc. feared that the average company loss is running beyond $34,000. It initially conducted a hypothesis test on a sample extracted from its database. The hypothesis was formulated as H0: average company loss $34,000 vs. H1: average company loss > $34,000. The test resulted in favor of Robin Inc.'s loss not exceeding $34,000. Detailed study of company accounts later revealed that the average company loss had run up to $37,896. Which of the following errors were made during the hypothesis test? Type I error Type II error Type III error Type IV error
B
The purpose of sampling is to ________. calculate all variables and observations within a population obtain sufficient information to draw a valid inference about a population enumerate all the values in the population measure all items of interest for a particular interest or investigation
B
When will a company use a predictive decision model? when it wishes to determine the best product pricing to maximize revenue when it wishes to know sales patterns to plan inventory levels when it wishes to ensure that a specified level of customer service is achieved when it wishes to know how best to use advertising strategies to influence sales
B
Which of the following Excel functions is applied to test for significance of regression? SINH ANOVA TREND COVAR
B
Which of the following allow meaningful comparison of ranges, averages and other statistics? categorical data interval data ordinal data ratio data
B
While checking for linearity by examining the residual plot, the residuals must: form a parabolic shape. be randomly scattered. be below the x-axis. exhibit a linear trend
B
________ states that if the sample size is large enough, the sampling distribution of the mean is approximately normally distributed, regardless of the distribution of the population and that the mean of the sampling distribution will be the same as that of the population. Oppermann's conjecture Central limit theorem Chebyshev's theorem Prime number theorem
B
Following are the components of a data set containing purchase details of a shoe manufacturing company. Identify the ratio data. Arrival date Rank of supplies Item Cost Item Numbers
C
Which of the following charts provides a useful means for displaying data over time? Scatter chart A doughnut chart Line chart Pie chart
C
Which of the following is an example of a measure of dispersion? mode median variance midrange
C
Which of the following is true about determining the proper form of the hypotheses? failure to reject H0 proves H1 wrong H1 is always assumed to be true in testing H0 is always assumed to be true in testing H0 is statistically proved true while testing
C
For a simple linear regression model, significance of regression is: a hypothesis test of whether the true regression coefficient ß1 is zero. the variability of the observed Y-values from the predicted values. a measure of how well the regression line fits the data. a statistic that modifies the value of R2 by incorporating the sample size and the number of explanatory variables in the model.
a
Prescriptive decision models help: decision makers identify the best solution to decision problems. make trade-offs between greater rewards and risks of potential losses. make predictions of how demand is influenced by price. Describe relationships and influence of various elements in the model
a
Which of the following is true about multicollinearity? It is best measured using the statistic variance inflation factor (VIF). The effect of a dependent variable on another becomes difficult to isolate. Regression coefficients become clearer and are easier to interpret. P-values reduce significantly leading to rejection of null hypothesis
a
Peige, a stock broker, has data consisting of price, price/earnings ratio, and market capitalization for seven different stocks on one particular day. She wishes to plot these three variables in two dimensions. Which of the following charts must Peige use? Surface Bubble Stock Line
b
Predictive analytics: summarizes data into meaningful charts and reports that can be standardized or customized. detects patterns in historical data and extrapolates them forward in time. uses data to determine a course of action to be executed in a given situation. identifies the best alternatives to minimize or maximize an objective
b
Standard residuals: cause differences in the regression equation by changing the slope and intercept. help detect outliers that may bias the results of a regression analysis. provide information for testing hypothesis associated with the intercept and slope. point out the ranges for the population intercept and slope at a 95% confidence level
b
The measure of location that specifies the middle value when the data are arranged from least to greatest is the ________. outlier median mode mean
b
The purpose of sampling is to ________. Hide answer choices enumerate all the values in the population obtain sufficient information to draw a valid inference about a population calculate all variables and observations within a population measure all items of interest for a particular interest or investigation
b
To construct a frequency distribution for categorical data, the: observations that appear in each category must be summed up. number of observations that appear in each category must be counted. observations in each category must be multiplied by observations in the corresponding category. number of observations in each category must be divided by the total number of observations in all categories.
b
Which of the following is a difference between a mean and a median? A mean is an observation that occurs most frequently; a median is the average of all observations. A median is not affected by outliers; a mean is affected by outliers. A median is not meaningful for ratio data; a mean is meaningful to ratio data. A mean divides the data half above it and half below it; a median does not.
b
Which of the following is true about determining the proper form of the hypotheses? failure to reject H0 proves H1 wrong H0 is always assumed to be true in testing H0 is statistically proved true while testing H1 is always assumed to be true in testing
b
Which of the following is true of the R-squared (R2) value in Excel's Trendline function? If the value of R2 is above 1.0, the line will be at a perfect fit for the data. As the value of R2 gets higher, the line will be a better fit for the data. The value of R2 will always be between -1 and 1. A value of 1.0 for R2 indicates maximum deviation of the data from the line
b
________ involves selecting items from a population so that every subset of a given size has an equal chance of being selected. Subjective sampling Simple random sampling Judgment sampling Convenience sampling
b
Which decision model incorporates the process of optimization? Descriptive Normative Prescriptive Predictive
c
Which of the following is a Type I error? the null hypothesis is actually false, and the test correctly rejects it the null hypothesis is actually false, but the test incorrectly fails to reject it the null hypothesis is actually true, but the hypothesis test incorrectly rejects it the null hypothesis is actually true, and the hypothesis test correctly fails to reject it
c
Which of the following is a disadvantage of ordinal data? They bear no relationship to one another. They have no natural zero. They have no fixed units of measurement. They are not comparable with each other
c
Which of the following propositions describes an existing theory or belief? alternative hypothesis standard deviation null hypothesis proportion
c
_______ means that the variation about the regression line is constant for all values of the independent variable. Autocorrelation Linearity Homoscedasticity Normality of errors
c
Descriptive decision models: help analyze the risks associated with various decisions. do not facilitate evaluation of different decisions. aim to predict what will happen in the future. describe relationships but do not tell a manager what to do
d
Which of the following is the inherent reason why sampling errors occur? because samples represent the whole population because samples never provide enough data to estimate standard deviation because the means cannot be accurately estimated using samples because samples are only a subset of the population
d
Which of the following is true when testing for normality of errors? It is easier to evaluate normality with small sample sizes. A scatter diagram of the whole data is always used to verify normality. Errors are normally distributed when the scatter diagram shows a straight-line distribution. Normality is verified by inspecting for a bell-shaped distribution
d
________ is based on dividing a population into subgroups, sampling a set of subgroups, and conducting a complete census within the subgroups sampled. Systematic sampling Continuous process sampling Judgment sampling Cluster sampling
d
One of the properties of the mean is that the sum of the deviations of each observation from the mean is zero.
t
A graphical depiction of a frequency distribution for numerical data in the form of a column chart is called a ________. histogram dendogram cartogram correlogram
A
If the alternative hypothesis includes the symbol <, the rejection region is in the upper tail. T/F
F
Observations consisting of pairs of variable data are required to construct a ________ chart. radar line doughnut scatter
D
Prescriptive decision models help: make trade-offs between greater rewards and risks of potential losses. describe relationships and influence of various elements in the model. make predictions of how demand is influenced by price. decision makers identify the best solution to decision problems
D
Roger wants to compare values across categories using vertical rectangles. Which of the following charts must Roger use? Line chart Pie chart Stacked column chart Clustered column chart
D
Which of the following allow meaningful comparison of ranges, averages and other statistics? Ordinal Categorical Ratio Interval
D
Which of the following is true of variance? Its value is inversely proportional to the degree to which the data is spread from the mean. It is the square root of standard deviation. It only requires the middle 50% of data to be calculated. The formula to calculate variance of a population is not the same as the formula to calculate variance of a sample
D
According to the empirical rules of standard deviation in statistics, approximately 68% of the observations will fall within three standard deviations of the mean.
F
For an odd number of observations, the median is the mean of the two middle numbers.
F
A good regression model has the fewest number of explanatory variables providing an adequate interpretation of the dependent variable.
T
