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COMM121 Business Statistics Tutorial Questions Week 7 (Chapter 8)

This document provides sample questions from Chapter 8 of a business statistics tutorial. The questions cover a range of topics including constructing confidence intervals to estimate population means based on sample data, interpreting the results, and determining if published values fall within the confidence intervals. Normal distribution assumptions and changes to standard deviations are explored across different business contexts involving light bulbs, water usage, paint in cans, greeting card values, packaged lollies, and costs of business travel.

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Ann Joy
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47 views

COMM121 Business Statistics Tutorial Questions Week 7 (Chapter 8)

This document provides sample questions from Chapter 8 of a business statistics tutorial. The questions cover a range of topics including constructing confidence intervals to estimate population means based on sample data, interpreting the results, and determining if published values fall within the confidence intervals. Normal distribution assumptions and changes to standard deviations are explored across different business contexts involving light bulbs, water usage, paint in cans, greeting card values, packaged lollies, and costs of business travel.

Uploaded by

Ann Joy
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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COMM121 Business Statistics

Tutorial Questions Week 7 (Chapter 8)


1) The quality control manager at light globe factory needs to estimate the mean life of
a large shipment of energy-saving light-emitting diode (LED) light globes. The
standard deviation is 3,000 hours. A random sample of 64 light globes indicates a
sample mean life of 34,000 hours.
a. Construct a 95% confidence interval estimate of the population mean life of light globes in this
Shipment.
b. Do you think that the manufacturer has the right to state that the light globes last an average of
35,000 hours? Explain.
c. Must you assume that the population of light globe life is normally distributed? Explain.
d. Suppose that the standard deviation changes to 6,000 hours. What are your answers in (a) and
(b).

2) Water resources in many parts of Australia are being closely watched and restrictions
have been imposed on activities such as garden watering. Suppose that Sydney Water
monitors water usage in a suburb and finds that for one summer the average
household usage is 408 litres per day. A year later it examines records of a sample of
50 households and finds that there is a daily mean usage of 380 litres with a standard
deviation of 25 litres.
a. Construct a 95% confidence interval for the population mean daily water usage in the second
summer. Assume the population usage is normally distributed.
b. interpret the interval constructed in (a)
c. Do you think water usage has changed in the second summer? Explain.

3) The manager of a paint supply store wants to estimate the actual amount of paint
contained in 4-litre cans purchased from a nationally known manufacturer. It is
known from the manufacturer’s specifications that the standard deviation of the
amount of paint is equal to 0.08 litres. A random sample of 50 cans is selected and the
sample mean amount per 4 litre can is 3.98 litres.
a. Construct a 99% confidence interval estimate of the population mean amount of paint included
in a 4-litre can.
b. On the basis of your results, do you think that the manager has a right to complain to the
manufacturer?
c. Must you assume that the population amount of paint per can is normally distributed here?
Explain.
d. Construct a 95% confidence interval estimate. How does this change the answer to part (b)?

4) A stationery store wants to estimate the mean retail value of greeting cards that it has
in its inventory. A random sample of 20 greeting cards indicates a mean value of $4.95
and a standard deviation of $0.82.
a. Assuming a normal distribution, construct a 95% confidence interval estimate of the mean value
of all greeting cards in the store’s inventory.
b. How are the results in (a) useful in assisting the store owner to estimate the total value of his
inventory?

5) A confectionery company fills a bag with 500 grams of individually wrapped lollies.
The number of lollies per bag varies because the bag is sold by weight. The company
wants to estimate the number of pieces per bag. Inspectors randomly sample 120 bags
and count the number of lollies in each. They find that the sample mean number of
lollies is 18.72.
a. Assuming a population standard deviation of .8735, what is the point estimate of the
number of lollies per bag?
b. Construct a 99% confidence interval to estimate the mean number of lollies per bag for
the population.

6) According to Runzheimer International, the average cost of a domestic trip for


business travellers in the financial industry is $1250. Suppose another travel industry
research company takes a random sample of 22 business travellers in the financial
industry and determines that the sample average cost of a domestic trip is $1192, with
a sample standard deviation of $279.
a. Construct a 95% confidence interval for the population mean from these sample data.
Assume that the data are normally distributed in the population.
b. Now go back and examine the $1250 figure published by Runzheimer International.
Does it fall into the confidence interval computed from the sample data? What does it
tell you?

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