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Exercises c3

This document provides examples and exercises for describing data using numerical measures such as mean, median, standard deviation, and interquartile range. It includes calculating these measures for sample data on topics like income, number of students eating breakfast, hours spent online, stock returns, net worth, number of tax returns completed, and number of RVs sold. It also includes multiple choice questions testing understanding of these concepts.

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ye ye
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Download as DOCX, PDF, TXT or read online on Scribd
77 views

Exercises c3

This document provides examples and exercises for describing data using numerical measures such as mean, median, standard deviation, and interquartile range. It includes calculating these measures for sample data on topics like income, number of students eating breakfast, hours spent online, stock returns, net worth, number of tax returns completed, and number of RVs sold. It also includes multiple choice questions testing understanding of these concepts.

Uploaded by

ye ye
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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CHAPTER 3: DESCRIBING DATA: NUMERICAL MEASURES

Exercise 3.1:
Calculate the following sample observations on income per week (USD) of
workers: 128, 131, 142, 168, 87, 93, 105, 114, 96, and 98.
1. Calculate and interpret the value of the sample mean
2. Calculate and interpret the value of the sample standard deviation,
Exercise 3.2:
The number of students eating breakfast at the school dining commons
was recorded over 110 days last semester. These data are presented below.
# of Students 160 but < 190 190 but < 220 220 but < 250 250 but < 280 280 but < 310

# of Days 11 27 42 23 7

3. Calculate the quantities ∑ f i , ∑ f i mi , and ∑ f i ( mi− x̄ )


2
.

4. What is the estimated mean number of students showing up for


breakfast?
What is the estimated standard deviation for this data?
Exercise 3.3:
In a recent survey, 12 students at a local university were asked
approximately how many hours per week they spend on the Internet. Their
responses were: 13, 0, 5, 8, 22, 7, 3, 0, 15, 12, 13, and 17.
1. What are the mean and standard deviation for this data?
2. What is the coefficient of variation for this data?
3. From the data presented above, calculate the inter-quartile range.
Exercise 3.4:
The annual percentage returns on two stocks over a 7-year period were as
follows:
Stock A: 4.01% 14.31% 19.01% -14.69% -26.49% 8.01%
5.81% 5.11%
Stock B: 6.51% 4.41% 3.81% 6.91% 8.01% 5.81%
5.11%
1. Compare the means of these two-population distribution.
2. Compare the standard deviations of these two population distributions.
3. Compute an appropriate measure of dispersion for both stocks to
measure the risk of these investment opportunities. Which stock is
more volatile?
Exercise 3.5:
A person is interested in constructing a portfolio. Two stocks are being
considered. Let x=percent return for an investment in stock 1, and y=
percent return for an investment in stock 2. The expected return and
variance for stock 1 are E(x) = 8.45% and Var(x) = 25%. The expected
return and variance for stock 2 are E(y) = 3.20% and Var(y) = 1%. The
covariance between the returns is σxy = -3.
a. What is the standard deviation for an investment in stock 1 and for an
investment in stock 2? Using the standard deviation as a measure of risk,
which of these stocks is the riskier investment?
b. What is the expected return and standard deviation, in dollars, for a
person who invests $500 in stock 1?
c. What is the expected percent return and standard deviation for a person
who constructs a portfolio by investing 50% in each stock?
d. What is the expected percent return and standard deviation for a person
who constructs a portfolio by investing 70% in stock 1 and 30% in stock
2?
e. Compute the correlation coefficient for x and y and comment on the
relationshipbetween the returns for the two stocks
Exercise 3.6:
A researcher is interested in examining how the net wealth of individuals
changes over the course of their lifetimes. She has collected the following
data regarding the age X, in years, and net worth Y, measured in thousands
of dollars, of 12 individuals in the form of (X, Y) pairs: (24, 153), (34,
201), (38, 297), (83, 139), (77, 167), (32, 123), (71, 247), (49, 263), (54,
352), (35, 321), (65, 453), and (30, 54).
1. Prepare a scatter plot of this data.
2. What conclusions can you draw about the relationship between age and
net wealth based on the scatter plot in the previous question?
3. Calculate the correlation coefficient between the age and net worth of
individuals.
Exercise 3.7:
A small accounting office is trying to determine its staffing needs for the
coming tax season. The manager has collected the following data: 46, 27,
79, 57, 99, 75, 48, 89, and 85. These values represent the number of
returns the office completed each year over the past nine years it has been
doing tax returns:
1. For this data, what is the mean number of tax returns completed each
year?
2. For this data, what is the median number of tax returns completed each
year?
3. For this data, what is the variance of the number of tax returns
completed each year?
4. For this data, what is the interquartile for the number of tax returns
completed each year?
5. For this data, what is the coefficient of variation for the number of tax
returns completed each year?

Exercise 3.8:
MULTIPLE-CHOICE QUESTIONS
1. Suppose you are told that the mean sample of numbers is below the
median. What does this information suggest?
A)The distribution is symmetric.
B) The distribution is skewed to the right or positively skewed.
C) The distribution is skewed to the left or negatively skewed.
D)There is insufficient information to determine the shape of the
distribution.
2. Which of the following descriptive statistics is least affected by
outliers?
A)Mean
B) Median
C) Range
D)Standard deviation

3. Which measures of central location are not affected by extremely


small or extremely large values data values?
A. Arithmetic mean and median
B. Median and mode
C. Mode and arithmetic mean
D. Geometric mean and arithmetic mean

4. The manager of a local RV sales lot has collected data on the number
of RVs sold per month for the last five years. That data is
summarized below
# of Sales 0 1 2 3 4 5 6
# of 2 6 9 13 21 7 2
Months
What is the weighted mean number of sales per month?
A)3.31
B) 3.23
C) 3.54
D)3.62

5. Which of the following statistics is not a measure of central


tendency?
a. Arithmetic mean.
b. Median.
c. Mode.
d. Q3.
6. Which of the arithmetic mean, median, mode, and geometric mean
are resistant measures of central tendency?
a. The arithmetic mean and median only.
b. The median and mode only.
c. The mode and geometric mean only.
d. The arithmetic mean and mode only.
7. In a perfectly symmetrical bell-shaped "normal" distribution
a. the arithmetic mean equals the median.
b. the median equals the mode.
c. the arithmetic mean equals the mode.
d. All the above.
8. In general, which of the following descriptive summary measures
cannot be easily approximated from a boxplot?
a. The variance.
b. The range.
c. The interquartile range.
d. The median.
9. In right-skewed distributions, which of the following is the correct
statement?
a. The distance from Q1 to Q2 is larger than the distance from Q2
to Q3.
b. The distance from Q1 to Q2 is smaller than the distance from
Q2 to Q3.
c. The arithmetic mean is smaller than the median.
d. The mode is larger than the arithmetic mean.
10. According to the empirical rule, if the data form a "bell-shaped"
normal distribution, _______ percent of the observations will be
contained within 1 standard deviation around the arithmetic mean.
a. 68.26
b. 75.00
c. 88.89
d. 93.75
11. Which of the following is NOT sensitive to extreme values?
a. The range.
b. The standard deviation.
c. The interquartile range.
d. The coefficient of variation.
12. According to the Chebyshev rule, at least 93.75% of all
observations in any data set are contained within a distance of how
many standard deviations around the mean?
a. 1
b. 2
c. 3
d. 4

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