Economics 10A

Probability and Statistics in Economics I 




 

Answers to Quiz #2 for Econ 10a

 

1.         Since the sun must rise tomorrow, then the probability of the sun rising tomorrow is

            a.            much larger than one

            b.            zero

            c.            infinity

d.      None of these alternatives is correct.

 

            Answer:  d

 

2.         Which of the following statements is(are) always true?

            a.   -1 £ P(Ei) £1

            b.            P(A) = 1 - P(Ac)

            c.            P(A) + P(B) = 1

d.      åP ³ 1

 

            Answer:  b

 

3.         If A and B are independent events with P(A) = 0.2 and P(B) = 0.6, then

            P(A U B) =

            a.            0.62

            b.            0.12

            c.            0.60

d.      0.68

 

            Answer:  d

 

4.         If P(A) = 0.38, P(B) = 0.83, and P(A I B) = 0.57; then P(A U B) =

            a.            1.21

            b.            0.64

            c.            0.78

d.      1.78

 

            Answer:  b

 

5.         Which of the following is a required condition for a discrete probability function?

            a.      Sf(x) = 0

            b.   f(x) ³ 1   for all values of x

            c.   f(x) < 0

d.      Sf(x) = 1

 

            Answer:  d

 

6.         Assume that you have a binomial experiment with p = 0.5 and a sample size of 100.  The expected value of this distribution is

            a.            0.50

            b.            0.30

            c.   100

d.      50

 

            Answer:  d

 

7.         Forty percent of all registered voters in a national election are female.  A random sample of 5 voters is selected. The probability that the sample contains 2 female voters is

            a.            0.0778

            b.            0.7780

            c.            0.5000

d.      0.3456

 

            Answer:  d

 

8.         The expected value of a random variable is

            a.   the value of the random variable that should be observed on the next repeat of the experiment

            b.   the value of the random variable that occurs most frequently

            c.   the square root of the variance

d.      None of these alternatives is correct.

 

            Answer:  d

 

 

9.         The variance for the binomial probability distribution is

            a.            var(x) = P(1 - P)

            b.            var(x) = nP

            c.            var(x) = n(1 - P)

d.      var(x) = nP(1 - P)

 

            Answer:  d

 

10.       Twenty percent of the students in a class of 100 are planning to go to graduate school.  The standard deviation of this binomial distribution is

            a.   20

            b.   16

            c.   4

d.      2

 

            Answer:  c

 

11.       For any continuous random variable, the probability that the random variable takes on exactly a specific value is

            a.            1.00

            b.            0.50

            c.   any value between 0 to 1

d.      almost zero

 

            Answer:  d

 

12.       Which of the following is not a characteristic of the normal probability distribution?

            a.            symmetry

            b.   The total area under the curve is always equal to 1.

            c.      99.72% of the time the random variable assumes a value within plus or minus 1 standard deviation of its mean

d.      The mean is equal to the median, which is also equal to the mode.

 

            Answer:  c

           

13.       Given that Z is a standard normal random variable, what is the probability that

            Z ³ -2.12?

            a.      0.4830

            b.      0.9830

            c.      0.017

d.      0.966

 

            Answer:  b

 

14.       For a standard normal distribution, the probability of obtaining a z value between

            -1.9 to 1.7 is

            a.      0.9267

            b.      0.4267

            c.      1.4267

d.      0.5000

 

            Answer:  a

 

15.       The point estimator with the smaller variance is said to have

            a.            smaller relative efficiency

            b.            greater relative efficiency

            c.            smaller relative consistency

b.      greater relative consistency

 

            Answer:  b

 

16.       As the sample size becomes larger, the sampling distribution of the sample mean approaches a

            a.            binomial distribution

            b.            Poisson distribution

            c.            normal distribution

c.       chi-square distribution

 

            Answer:  c

 

17.       A property of a point estimator that occurs whenever the expected value of the point estimator is equal to the population parameter it estimates is known as

            a.            consistency

            b.   the expected value

            c.   the estimator

d.      unbiasedness

 

            Answer:  d

 

18.       If σ is the standard deviation of a population of infinite size, the standard error of a sample mean is always equal to:

            a.   s

            b.            sample deviation

            c.   σ / sqrt (n)

e.       population mean

 

            Answer:  c

 

19.       The following information was collected from a simple random sample of a population.

            16            19            18            17            20            18

 

            The point estimate of the population standard deviation is

            a.            2.000

            b.            1.291

            c.            1.414

d.      1.667

 

            Answer:  c

 

20.       The purpose of statistical inference is to provide information about the

            a.            sample based upon information contained in the population

            b.            population based upon information contained in the sample

            c.            population based upon information contained in the population

d.      mean of the sample based upon the mean of the population

 

            Answer:  b

 

 

21.      Random samples of size 36 are taken from an infinite population whose mean and standard deviation are 20 and 15, respectively.  The distribution of the population is unknown.  The mean and the standard error of the mean are

            a.   36 and 15

            b.   20 and 15

            c.   20 and 0.417

d.      20 and 2.5

 

            Answer:  d

 

22.       F is a cumulative distribution function (CDF), which of the followings is not correct?

a.       F(min) = 0

b.      F(median) = 0.50

c.       F(Q2) = 0.25

d.      F(max) = 1

 

            Answer: c

 

 

23.       A local bank has determined that the daily balances of the checking accounts of its customers are normally distributed with an average of $280 and a standard deviation of $20. What percentage of its customers has daily balances of more than $275?

           

 

            Answers: 59.87%

 

 

24.       Assume two events A and B are mutually exclusive and, furthermore, P(A) = 0.2 and P(B) = 0.4. Find P(AôB).

 

            Answers: 0

 

25.       Four workers at a fast food restaurant pack the take-out chicken dinners.  John packs 45% of the dinners but fails to include a salt packet 4% of the time.  Mary packs 25% of the dinners but omits the salt 2% of the time.  Sue packs 30% of the dinners but fails to include the salt 3% of the time.  You have purchased a dinner and there is no salt. Find the probability that Mary packed your dinner.

 

            Answers: 0.15625

 

 

 

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