Predictive Business Analytics Exam 1

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Over many trials, the 99% confidence interval will NOT include the true population parameter what percent of the time?

1% of the time

If y=b+mX and sCov(X,Y)=96, sVar(X)=12, sVar(Y)=21, sMean(X)=4, sMean(Y)=2; what is the y-intercept?

2 - (8*4) = -30

Suppose a sample of five analytics students' heights were: 62 inches, 72 inches, 58 inches, and 48 inches. What is the sample mean of the height of the students?

60 inches

If y=b+mX and sCov(X,Y)=96, sVar(X)=12, sVar(Y)=21, sMean(X)=4, sMean(Y)=2; what is the slope m?

96/12 = 8

A hypothesis in a predictive analytics setting is ____________.

A proposed idea based on limited evidence that leads to further investigation

When making a claim via inductive reasoning, which of the following is true concerning the degree of support?

An objective degree of support has a statistical foundation, generally constructed via deductive reasoning.

In making an active prediction it is advantageous for the relationship being predicted to be of what sort?

Causal

In grouping customers into separate types according to their spending, internet browsing, payment method, and age a firm is engaging in what sort of analysis?

Cluster analysis

Of the following, which is not an element in the scientific method?

Collect Market Data

A random variable that takes on a countably infinite number of values is known as what type of random variable?

Continuous

The process of forming conclusions, judgments, or inferences from facts or premises is:

reasoning

If you are trying to prove that A causes B, why does it make sense to have your null hypothesis be "A does not cause B"?

Data cannot confirm a hypothesis and it is easier to make strong inductive arguments when rejecting a hypothesis

Suppose a colleague claims that if the price elasticity of demand for the company's good is inelastic, then raising the price of the good will lead to higher sales. This is example of what type of reasoning?

Deductive reasoning

Suppose we are proving the statement that if two integers are even, then their sum is even. We execute the proof by first showing that if integer A and B are even, then they can be defined as A = 2k and B = 2m. We then note that their sum must be A + B = 2(k + m), which must be even. This is an example of what type of proof?

Direct proof

The effect of the treatment on the treated (ETT) is the average treatment effect for the group given the treatment is which of the following?

ETT + Selection Bias

When does the difference in the mean outcomes across the treated and untreated groups yield an unbiased estimate of the average treatment effect?

ETT = ATE

If you were building a hypothesis test to determine whether or not the price elasticity of demand for your product is -3.0, which of the following would be a natural null hypothesis?

Ho: mu = -3.0

Reasoning that goes from the specific (e.g., a data sample) to the general (e.g. the population) is known as:

Inductive reasoning

Taking samples of registered voters and asking them to disclose their preferences leading up to elections in order to assess the view of all registered voters on a particular candidate is an example of what sort of reasoning?

Inductive reasoning

The greatest impediment to using nonexperimental data to measure treatment effects is that __________.

Lack of random assignment of the treatment

If the residual for a point is -6, which of the following is true?

Negative value means prediction was too high (6 high)

Most data available to business are ______________ data.

Non experimental Data

A hypothesis to be tested using a data sample is known as _____.

Null Hypothesis

Suppose you want to answer the following question: "How will Sales of version 2.0 of our product change when we release version 3.0 of our product?" What type of data analysis is crucial toward answering this question?

Passive prediction

If the residual for a point is 4, which of the following is true?

Positive value means prediction was too low (4 low)

Which of the following are empirically testable conclusions?

Price markups should be lower in markets with more firms.

Which is not a primary component in deductive reasoning?

Sample of observations

Suppose you collect monthly sales figures for each store location in your company as well as the wages paid to employees for each store, and that you have a complete history for the last ten years for each store. Provided this information is in table format, the information you've gathered is an example of what type of data?

Structured data

For the same sample, the 90% confidence interval will have what relation to the 95% confidence interval?

The 95% confidence interval will be wider and more accurate

If you are intending to refute conclusions drawn via clear deductive reasoning, what must you disagree with?

The assumptions or the methods of proof

The treatment effect is ______________.

The change in the outcome resulting from variation in the treatment

If Profit is the Y variable, and Price is the X variable, and m is positive, which of the following is the correct interpretation of the equation?

The higher the prices, the larger the profit (Positive Correlation)

If Profit is the Y variable, and Price is the X variable, and m is negative, which of the following is the correct interpretation of the equation?

The higher the prices, the lower the profit (Negative correlation)

Which of the following are you assuming is true to calculate the p-value of a test statistic?

The null hypothesis is true (not certain)

Suppose there is a promotion using a sign to entice customers to purchase a candy bar. The promotion sign is in place 50% of the four-hour blocks over two weeks. The sign was up for all hours just before lunch and dinner times. The number of purchases when the sign was up was twice as high as times when the sign was not up. Why would the effect of treatment on the treated not equal the average treatment effect?

The sign was not up for all hours and therefore the treatment would not equal the average (Complete bullshit btw)

Suppose there are 100 subjects receiving a cholesterol drug and 100 who do not. The average level change was -48 for those given the drug, and -6 for the rest. What is a reason why this difference exists?

The treatment effect

In a broad sense, the role of a confidence interval for the population mean is meant to accurately portray what?

The uncertainty involved with observing a sample and not the entire population.

Which of the following statements best summarizes the use of business analytics?

The use of data analysis to aid in business decision making

The form of the potential outcome framework paradigm (the simple treatment framework) is which of the following?

Treatment effect = outcome Ti - outcome NTi

Why is it that inductive reasoning does not involve a proof?

We cannot prove the general from the specific

Which of the following is not an element of the scientific method?

Write down scientific method

Which question below is NOT an example of one plausibly used in the scientific method?

Write down scientific method

The scientific method includes of the following except which one?

Write down scientific method - 1. Ask a question, 2. Do research, 3. Formulate a hypothesis, 4. Conduct experiment, 5. Analysis data, 6. Communicate findings

At what X-value would the line defined by Y = 20 + 10X cross the x-axis?

X = -2

Suppose your model follows the standard form of the simple regression equation, Y = b + mX, with Y = 4 + (-2)X, at what X-value would the line defined by that equation cross the x-axis?

X = 2

Suppose that your equation is Y = -28 + 7X. What value of Y is where the line defined by that equation crosses the y-axis

Y = -28

In the standard form of the simple regression equation, Y = b + mX, at what point would the line defined by that equation cross the y-axis?

Y = b

Suppose you've assumed the following two data-generating processes: (1) Yi = f (Hi, Ji) and (2) Ji = g (Xi, Zi). What do these assumptions imply?

Z has an indirect causal effect on Y.

In the deductive reasoning behind the claim that "If firms sell homogenous products, then prices should fall to marginal costs" the role of "firms sell homogenous products" is:

an assumption

Reasoning that goes from the general to the specific or "top-down" logic is known as:

deductive reasoning

Measures of the central tendencies of variables such as the mean, median, and mode are examples of _________________.

descriptive statistics

Measures of the spread of variables such as the variance and range are examples of _______________

descriptive statistics

Quantitative measures meant to summarize and interpret properties of a dataset are instances of ________

descriptive statistics

As long as your sample is large enough, you don't have to worry about using the sample standard deviation in place of the unknown population standard deviation in constructing a confidence interval because ________.

for a large sample, the t-distribution is similar to the standard normal distribution

As the size of a random sample gets larger, what does the distribution of the sample mean begin to resemble?

normal distribution

The probability of attaining a test statistic at least as extreme as the one that was observed is known as the _____.

p-value

By showing your colleague that the conclusions of your analysis regarding the optimal pricing strategy for the firm would be the same under a variety of different assumptions regarding the price response of competitors is an example of:

robustness

The primary distinction between a subjective degree of support and an objective degree of support is the use of a(n):

statistical foundation

Degrees of support based off opinion and ultimately lacking any statistical foundation are often termed:

subjective degree of support

If Profit is the Y variable, and Price is the X variable, m is -10 and b is -20, at what point is the breakeven reached?

x = -2

If you have a model that follows the standard form of the simple regression equation, Y = b + mX, with Y = -16 + 4X, at what X-value would the line defined by that equation cross the x-axis?

x = 4


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