INDIVIDUAL ASSIGNMENT 2

MAS202
Business Statistics
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SCENARIO 1: A company producing orange juice buys all its oranges from a large orange
orchard. The amount of juice that can be squeezed from each of these oranges is approximately
normally distributed with a mean of 4.7 ounces and some unknown standard deviation. The
company’s production manager knows that the probability is 30.85% that a randomly selected
orange will contain less than 4.5 ounces of juice.
𝜎
1. Using the function NORM.S.INV in Mircosoft Excel to estimate where 𝑛 is the sample
√𝑛

size used by company’s production manager.

2. What is the probability that a randomly selected orange will contain between 4.5 and 5.2
ounces of juices?
3. What is the probability that a randomly selected orange will contain between 4.2 and 4.9
ounces of juices?
4. What is the probability that a randomly selected orange will contain at least 4.9 ounces of
juices?
5. What is the probability that a randomly selected orange will contain more than 4.2 ounces
of juices?
SCENARIO 2: The time spent studying by students in the week before final exams follows
a normal distribution with a standard deviation of 8 hours. A random sample of 4 students was
taken to estimate the mean study time for the population of all students.
1. What is the probability that the sample mean exceeds the population mean by more than 2
hours?
2. What is the probability that the sample mean is more than 3 hours below the population

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mean?
3. What is the probability that the sample mean differs from the population mean by less than
2 hours?
SCENARIO 3: The lifetimes of a certain brand of light bulbs are known to be normally
distributed with a mean of 1,600 hours and a standard deviation of 400 hours. A random
sample of 64 of these light bulbs is taken.
1. What is the probability that the sample mean lifetime is more than 1,550 hours?
2. The probability is 0.15 that the sample mean lifetime is more than how many hours?
3. The probability is 0.20 that the sample mean lifetime differs from the population mean
lifetime by at least how many hours?
SCENARIO 4:
1. A quality control engineer is interested in the mean length of sheet insulation being
cut automatically by machine. The desired mean length of the insulation is 12 feet. It is known
that the standard deviation in the cutting length is 0.15 feet. A sample of 70 cut sheets yields
a mean length of 12.14 feet. This sample will be used to obtain a 99% confidence interval for
the mean length cut by machine. Determine this confidence interval?
2. To become an actuary, it is necessary to pass a series of 10 exams, including the most
important one, an exam in probability and statistics. An insurance company wants to estimate
the mean score on this exam for actuarial students who have enrolled in a special study
program. They take a sample of 8 actuarial students in this program and determine that their
scores are: 2, 5, 8, 8, 7, 6, 5, and 7. This sample will be used to calculate a 90% confidence
interval for the mean score for actuarial students in the special study program. Determine this
confidence interval?
SCENARIO 5:
1. A university dean is interested in determining the proportion of students who receive
some sort of financial aid. Rather than examine the records for all students, the dean randomly
selects 200 students and finds that 118 of them are receiving financial aid. Use a 90%
confidence interval to estimate the true proportion of students who receive financial aid.
2. The head of a computer science department is interested in estimating the proportion
of students entering the department who will choose the new computer engineering option.

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Suppose there is no information about the proportion of students who might choose the option.
What size sample should the department head take if she wants to be 95% confident that the
estimate is within 0.10 of the true proportion?
SCENARIO 6:

A poll was conducted by the marketing department of a video game company to

determine the popularity of a new game that was targeted to be launched in three months.
Telephone interviews with 1,500 young adults were conducted which revealed that 49% said
they would purchase the new game. The margin of error was ±3 percentage points.

1. What is the sampling error?

2. What is the needed sample size to obtain a 95% confidence interval estimate of the
percentage of the targeted young adults who will purchase the new game by allowing the same
level of margin of error?

3. What is the needed sample size to obtain a 95% confidence interval in estimating the
percentage of the targeted young adults who will purchase the new game to within±5% if you
do not have the information on the 49% in the interviews who said that they would purchase
the new game?

SCENARIO 7:
The Three Brothers Energy Drink Company bottles and distributes a popular drink for
athletes and exercise enthusiasts. Because of its marketing successes the company has
installed an additional filling machine and the managers are eager to use it in daily operations.
The machine is set to fill bottles at 16 oz. However, we know there is inherent machine
variability and quality control has determined through testing a mean of 16.2 oz. and a standard
deviation of 0.3 oz. using a 100 bottle sample.
1. In calculating a 90% confidence interval for the population what would be the
sampling error?
2. Find a 90% confidence interval for the mean volume of the filled bottle contents
3. Suppose you want to estimate the population mean fill with 95% confidence and 0.04
oz. sampling error rate. What should be your sample size?

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 SCENARIO 8:
An appliance manufacturer claims to have developed a compact microwave oven that
consumes a mean of no more than 250 W. From previous studies, it is believed that power
consumption for microwave ovens is normally distributed with a population standard
deviation of 15 W. A consumer group has decided to try to discover if the claim appears true.
They take a sample of 20 microwave ovens and find that they consume a mean of 257.3 W
1. What is the parameter of interest?
2. Can the consumer group conclude that there is enough evidence that the
manufacturer’s claim is not true when allowing for a 5% probability of committing a Type I
error?

SCENARIO 9:
One of the biggest issues facing e-retailers is the ability to turn browsers into buyers.
This is measured by the conversion rate, the percentage of browsers who buy something in
their visit to a site. The conversion rate for a company’s website was 10.1%. The website at
the company was redesigned in an attempt to increase its conversion rates. A sample of 200
browsers at the redesigned site was selected. Suppose that 24 browsers made a purchase. The
company officials would like to know if there is evidence of an increase in conversion rate at
the 5% level of significance.
1. What critical value should the company officials use to determine the rejection region?
2. Is it true if the company officials can conclude that there is sufficient evidence that
the conversion rate at the company’s website has increased using a level of significance of
0.05?
3. What will be the p-value if these data were used to perform a two-tail test?
SCENARIO 10:
The president of a university claimed that the entering class this year appeared to be
larger than the entering class from previous years but their mean SAT score is lower than
previous years. He took a sample of 20 of this year’s entering students and found that their
mean SAT score is 1,501 with a standard deviation of 53. The university’s record indicates
that the mean SAT score for entering students from previous years is 1,520. He wants to find
out if his claim is supported by the evidence at a 5% level of significance. Please help him.