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Name- Registration Number- Section- Assignment

Number-
HIM CIA 3.1

Note-

1. Every question should start from the first page-


2. Question should also be written before the Answer
3. Mention each step clearly
4. After due date Assignment will not be considered
5. Marks will be given only for the complete and correct solution
One sample Z test

Q1. The average annual total return for U.S. Diversified Equity mutual funds from 1999 to 2003
was 4.1% (BusinessWeek, January 26, 2004). A researcher would like to conduct a hypothesis test
to see whether the returns for mid-cap growth funds over the same period are significantly
different from the average for U.S. Diversified Equity funds.
a. Formulate the hypotheses that can be used to determine whether the mean annual return for
mid-cap growth funds differ from the mean for U.S. Diversified Equity funds.
b. A sample of 40 mid-cap growth funds provides a mean return of sample mean=3.4%. Assume
the population standard deviation for mid-cap growth funds is known from previous studies to be
= 2%. Use the sample results to compute the test statistic and p-value for the hypothesis test.
c. At = .05, what is your conclusion?

One sample t test


Q2. Annual per capita consumption of milk is 21.6 gallons (Statistical Abstract of the United
States: 2006). Being from the Midwest, you believe milk consumption is higher there and wish to
support your opinion. A sample of 16 individuals from the mid western town of Webster City
showed a sample mean annual consumption of 24.1 gallons with a standard deviation of s =4.8.
a. Develop a hypothesis test that can be used to determine whether the mean annual
consumption in Webster City is higher than the national mean.
b. What is a point estimate of the difference between mean annual consumption in Webster City
and the national mean?
c. At = .05, test for a significant difference. What is your conclusion?

One sample Proportion


Q3. A study by Consumer Reports showed that 64% of supermarket shoppers believe
supermarket brands to be as good as national name brands. To investigate whether this result
applies to its own product, the manufacturer of a national name-brand ketchup asked a sample of
shoppers whether they believed that supermarket ketchup was as good as the national brand
ketchup.
a. Formulate the hypotheses that could be used to determine whether the percentage of
supermarket shoppers who believe that the supermarket ketchup was as good as the national
brand ketchup differed from 64%.
b. If a sample of 100 shoppers showed 52 stating that the supermarket brand was as good as the
national brand, what is the p-value?
c. At = .05, what is your conclusion?
d. Should the national brand ketchup manufacturer be pleased with this conclusion?

Two sample z test


Q4. Will improving customer service result in higher stock prices for the companies providing the
better service? When a companys satisfaction score has improved over the prior years results
and is above the national average (currently 75.7), studies show its shares have a good chance of
outperforming the broad stock market in the long run (Business- Week, March 2, 2009). The
following satisfaction scores of three companies for the 4th quarters of 2007 and 2008 were
obtained from the American Customer Satisfaction Index. Assume that the scores are based on a
poll of 60 customers from each company. Because the polling has been done for several years,
the standard deviation can be assumed to equal 6 points in each case.

Company 2007Score 2008Score


RiteAid 73 76
Expedia 75 77
J.C.Penney 77 78
a. For Rite Aid, is the increase in the satisfaction score from 2007 to 2008 statistically significant?
Use =.05. What can you conclude?
b. Can you conclude that the 2008 score for Rite Aid is above the national average of 75.7? Use
=.05.
c. For Expedia, is the increase from 2007 to 2008 statistically significant? Use = .05.