SRI BALAJI UNIVERSITY PUNE (SBUP)

BIMM
SEMESTER-I-BATCH -2020-22
BUSINESS STATISTICS
ASSIGNMENT –5 (UNIT-5)

(a)  Name of Student: - Manish Chauhan

(b)  Reg. No: - 09-1128
(c)  Specialization: - Marketing
(d)  Batch: - 2020-2022
(e)  Institute: - Balaji Institute of Modern Management
(f)  Semester: - Semester 1
(g)  Subject Name: - Business Statistics
(h)  Assignment No: - 5
(i)  Submission Date: -06/12/2020
(j)  Total no. of pages written: - 13
Q.1 Record of several years of applicants for admission at FMS showed there means
score as 115. And administrator is interested in knowing whether the calibre of recent
applicants has changed. For the purpose of testing this hypothesis the scores of a sample
of 100 applicants from the score of recent applicants was obtained from the admission
office. The mean for this turned out to be 118. The sample standard deviation is 28,
which may also be assumed for the population. Test the hypothesis using 5% level of
significance.

A.

σ = 28marks

n = 100students

x́=118 marks

1. setup Ho and Ha:

Ho: μ = 115marks (caliber of recent applicants has not changed)

Ha: μ ≠ 115marks (caliber of recent applicants has changed)

2. Level of significance:

α = 0.05

∴ α/2 = 0.05/2 = 0.025

Area = 0.5 – 0.025 = 0.475

∴ Zα/2 = ±1.96 (both sides of mean so, ±Z)

3. Test statistics: (here Z test)

x́−μ
Z=
σ
( )
√n
4. Decision rule:

If −Z cal ←1.96 or Z cal> 1.96 then, reject.

5. Calculation:

x́−μ 118−115
Z= = =1.071
σ 28
( ) (
√n √ 100 )
6. Conclusion:
Z cal< 1.96

∴ Do not reject Ho

∴ Caliber of recent students has not changed.

Q.2 A manufacture of flashlight batteries claims that the mean life of this product will
exceed 30 hours. A company is willing to buy a very large quantity of batteries is tested
and it is found that the sample is 32 hours, with a standard deviation of 4.5 hours.
Would the company buy, test using α = 0.01.

A.

n = 36battries

x́=32 hours

S = 4.5Hours

1. setup Ho and Ha:

Ho: μ = 30Hours (The mean life of product is 30Hours)

Ha: μ > 30Hours (The mean life of product is more than 30Hours)

2. Level of significance:

α = 0.01

Area = 0.5 – 0.01 = 0.49

∴ Zα = 2.33

3. Test statistics: (here Z test)

x́−μ
Z=
S
( )
√n
4. Decision rule:

If Z cal> 2.33 then, reject Ho.

5. Calculation:

x́−μ 32−30
Z= = =2.66
S 4.5
( ) ( )
√n √ 36
6. Conclusion:
Z cal> 2.33

∴ Reject Ho

Accept Ho

∴ Ho: The mean life of battery exceeds 30Hours. So, company is willing to buy large
quantity of batteries.

Q.3 A company is using two types of industrial belts. A random sample of 45 Brand A
belts are found to have mean life of 1665 hours with standard deviation of 128 hours;
which a random sample of Brand B belts are found to have mean life of 1705 hours with
a standard deviation of 136 hours can be say that the difference of 40 hours is there
mean lives is not significant at 0.01 level of significance.

A.

x́ A=1665hours

x́ B =1705 hours

S A =128 hours

S B=136 hours

n A =n B=45

1. setup Ho and Ha:

Ho: μ1 – μ2 = 0 [40hours difference between both is not significant]

Ha: μ1 – μ2 ≠ 0 [40hours difference between both is significant]

2. Level of significance:

α = 0.01 α/2= 0.005

Area = 0.5 – 0.005 = 0.495

∴ Z α =± 2.58

3. Test statistics:

( x́ A −x́ B ) −( μ 1 – μ 2 )
Z=
SA2 S 2
√( nA )( )
+ B
nB

4. Decision rule:
If Z cal> 2.58 or −Z cal ←2.58 then, reject Ho.

5. Calculation:

( x́ A− x́ B)−(μ 1 – μ 2) (1665−1705)−0
Z= = =−1.44
2 2 2 2

√( SA
nA
S
)( )
+ B
nB √( 128
45)( )
+
136
45

6. Conclusion:

−Z cal>−2.58

∴ Do not reject Ho. So, 40hours difference between both is not significant at 0.01 level of
Significance.

Q.4 Test the null hypothesis Ho: μ =90 against alternate hypothesis H1: μ ≠ 90. Using α
=0.05. Given that for a sample of 10 observations x̅= 93.2 and sum of squares of
deviation from mean = 148.8.

A.

n = 10

x́=93.2

( x−x́ )2=148.8

( x −x́ )2
S=
√( n−1 ) =4.0661

1. Setup Ho and Ha.

Ho: μ=90

Ha: μ ≠ 90

2. Level of significance.

α = 0.05

df = 10 - 1 = 9

t α / 2=± 2.262

3. Test statistics

Small sample population SD unknown so test used is t test

4. Decision rule:
−t cal ←2.262 or t cal >2.262 reject Ho.

5. Calculation:

S 4.0661
SEx́ = = =1.2858
√ n √ 10
x́−μ 93.2−90
t cal= = =2.489
SE x́ 1.2858

6. Conclusion.

t cal >2.262, ∴ reject Ho.

∴ Ho : μ ≠ 90

Q.5 Truckloads of coal received at a power plant. The trucks are contracted to carry the
average 10 tons of coal per truck load. A sample of 18 loads showed the mean to be 9.8
tons with a standard deviation of 1.2 tons. Assuming the weight per truck load is
distributed normally, thus the sample provides sufficient evidence to conclude that the
loads are lighter in weight than contracted? Use α = 1 %

A.

S=1.2tons

x́=9.8 tons

n=18 loads

1. Setup Ho and Ha

Ho: μ=10tons [The loads are not lighter in weight than contracted]

Ha: μ<10 tons [The loads are lighter in weight than contracted]

2. Level of significance:

α = 0.01

df =n – 1=18 – 1=17

t α / 2=2.567

3. Test statistics

Small sample population SD unknown so test used is t test

x́−μ
t cal=
SE x́
 4. Decision rule:

−t cal ←2.567 reject Ho.

5. Calculation:

S 1.2
SEx́ = = =0.2828
√ n √ 18
x́−μ 9.8−10
t cal= = =−0.7072
SE x́ 0.2828

6. Conclusion.

−t cal ←2.567,

∴ Accept Ho. So, the loads are not lighter in weight than contracted

Q.6 The means of two random sample of sizes 9 and 7 are 196.42 and 198.82 respectively.
The sum of squares of the deviation from respective mean is 26.94 and 18.73. Can the sample
considered to be drawn from the same normal population?

A.

n A =9

n B=7

x́ A=196.42

x́ B =198.82

( x−x́ ) A2=26.94

( x−x́ )B2 =18.73

1. Setup Ho and Ha.

H0: μ1 – μ2 = 0 [Samples are drawn from the same population]

Ha: μ1 – μ2 ≠ 0 [Samples are not drawn from the same population]

2. Level of significance:

α = 0.05

df =n A + nB −2=9+ 7−2=14

t α / 2=± 2.145
 3. Test statistics

Small sample population SD unknown so test used is t test

( x́ A− x́ B )−( μ A−μ B )
t cal=

√ ([ n1 )+( n1 )]
S^ 2p∗
A B

4. Decision rule:

−t cal ←2.145 or t cal >2.145 reject Ho

5. Calculation:

( x− x́ ) A2
SA=
√( n A −1
=
26.94
)√ 8
=1.8351

( x− x́ )B2
S B=
√( n B−1
=
18.73
)√6
=1.7668

^S2p= (
( n A −1 )∗S 2A )+ ( ( n B−1 )∗S2B ) ( ( 9−1 )∗1.89512 ) + ( ( 7−1 )∗1.7668 2) 47.461
= = =3.39
( n A +n B −2 ) ( 9+7−2 ) 14

( x́ A− x́ B )−( μ A−μ B ) ( 196.42−198.82 )−0

t cal= = =−2.5865

√ [( ) ( )] √ [ ( ) ( )]
S^ 2p∗
1
nA
+
1
nB
3.39∗
1
9
+
1
7

6. Conclusion:

−t cal ←2.145

∴ Reject Ho. So, the samples are not drawn from the same population.

Q.7 The times of India conducted two surveys – one in Bangalore and other in Chennai.
In Bangalore a random sample of 2000 readers, 1260 were observed to be the readers of
times of India. In Chennai in a random sample of 3000, 1635 were observed to be
readers of Times of Inida. Based on this sample data, can we conclude that the market
share (%) of times of India is higher in Bangalore that that of Chennai? (Take α = 3%)

A.

n B=2000

Reader B =1260
nC =3000

Reader C =1635

1. Setup Ho and Ha:

H o =π small−π large =0 (Market share (%) of times of India is not higher in Bangalore that that
of Chennai)

H o =π small > π large (Market share (%) of times of India is higher in Bangalore that that of
Chennai)

2. Level of significance

α = 0.03

Zα = +1.89

3. Test statistics:

Large sample population SD unknown. So, we will use Z test.

4. Decision rule:

Z cal>+ 1.89, reject Ho.

5. Calculation:

1260 1635
pB = =0.63 ; p C = =0.545
2000 3000

( n B∗p B ) + ( nC∗pC ) ( 2000∗0.63 ) + ( 3000∗0.545 )

ṕ= = =0.579
nB + nC 2000+3000

√
SE△ p= ṕ∗( 1− ṕ )∗
(( ) ( )) √
1
nB
+
1
nC
= 0.579∗( 1−0.579 )∗
1
2000
+
1
(( ) ( ))
3000
=0.0143

( p B −p C )−( π B−π C ) ( 0.63−0.545 )−( 0 )

Z cal= = =5.944
SE △ p 0.0143

6. Conclusion:

Z cal>+ 1.89, reject Ho.

∴ Market share (%) of times of India is higher in Bangalore that that of Chennai.
Q.8 Zee TV believes that its viewership is 29%. Random sample of 600 TV is taken. Out
of these, only 150 observed zee TV programs. Do you support the belief of Zee TV?
Take α = 5%.

A.

n=600 TVs

π=29 %=0.29

p=150 /600=0.25

1. setup Ho and Ha:

Ho: π=0.29 (Zee TV’s viewership is 29%.)

Ha: π ≠ 0.29 (Zee TV’s viewership is not 29%.)

2. Level of significance:

α = 0.05

∴ α/2 = 0.05/2 = 0.025

Area = 0.5 – 0.025 = 0.475

∴ Zα/2 = ±1.96 (both sides of mean so, ±Z)

3. Test statistics: (here Z test)

p−π
Z=
SE p

4. Decision rule:

If −Z cal ←1.96 or Z cal> 1.96 then, reject.

5. Calculation:

π∗( 1−π ) 0.29∗( 1−0.29 )

SE p=
√ n √
=
600
=0.0185

p−π 0.25−0.29
Z= = =−2.16
SE p 0.0185

6. Conclusion:

−Z cal ←1.96

∴ Reject Ho
∴ I don not support the belief of ZEE TV that its viewing is 29%.

Q.9 A nationally known manufacturer of replacement shock absorbers claims that its
product lasts longer that the types of shock absorbers that the car manufacturers
installs. To test these claims that, 8 cars each had one new original and one new
replacement shock absorber installed on the rear end and was driven until the shock
absorbers were no longer effective. In each case, the number of miles, until this
happened was recorded. The results are shown here: -

Original 42.6 37.2 50 43.9 53.6 32.5 46.5 39.3

Replacement 43.8 41.3 49.7 45.7 52.5 36.8 47.0 40.7

Is there sufficient evidence at 5 % level of significance to support the manufacturer claims.

A.

Sr no. Original Replacement D D2

1 42.6 43.8 -1.2 1.44

2 37.2 41.3 -4.1 16.81

3 50 49.7 0.3 0.09

4 43.9 45.7 -1.8 3.24

5 53.6 52.5 1.1 1.21

6 32.5 36.8 -4.3 18.49

7 46.5 47.0 -0.5 0.25

8 39.3 40.7 -1.4 1.96

Total 345.6 357.5 -11.9 43.49

1. Setting Ho and Ha:

Ho: μ D=0 (No difference in product and that of the type of shock absorbers that the car
manufacturers installs.)
Ha: μ D <0 (Product lasts longer than that the types of shock absorbers that the car
manufacturers installs.)

2. Level of significance:

α = 0.05

df = n – 1 = 8 – 1 = 7

t α =±1.895
( 2)
3. Test statistics:

Small sample and population SD unknown so we will use t test for dependent samples.

D́−μ D
t cal=
S D́

4. Decision rule:

−t cal ←1.895 or t cal >1.895; reject Ho

5. calculation:

√
2
−11.92

√
(∑ D)
S D=
∑( D¿¿ 2)−
n
=
43.49−
8 ( )
=1.9194 ¿
n−1 8−1

S D 1.9194
S D́= = =0.6786
√D √8
∑ D −11.9
D́= = =−1.4875
n 8

D́−μ D −1.4875−0
t cal= = =−2.1920
S D́ 0.6786

6. conclusion:

−t cal ←1.895, So, reject Ho.

Accept Ho

∴ Yes, the product lasts longer than that the types of shock absorbers that the car
manufacturers install.

Q.10 Two brands of bulbs are tested for life.

 Brand Sample size Average life Standard deviation

A 100 1329 hours 90 hours

B 100 1240 hours 75 hours

Can we conclude that Brand A is superior (in average life) than Brand B? Take α = 5 %.

A.

x́ A=1329hours

x́ B =1240 hours

S A =90 hours

S B=75 hours

1. Setup Ho and Ha.

Ho: μ A =μB [Brand A is not superior (in average life) than Brand B]

Ha: μ A > μ B [Brand A is superior (in average life) than Brand B]

2. Level of significance

α =5 %

α
=2.5 %=0.025
2

Z=±1.96

3. Test statistics:

Large sample population SD unknown so we will use Z test

4. Decision:

Z cal> 1.96 or −Z cal ←1.96 reject Ho.

5. Calculation:

( x́ A −x́ B )−( μ A −μ B ) (1329−1240 )− ( 0 )

Z cal= = =7.60
2 2 2 2

√( SA
nA
+
S
)( )
nB
B
(√ 100
90 75
)+( 100 )
6. Conclusion:
Z cal> 1.96. So, we will reject the Ho.

∴ Brand A is superior (in average life) than Brand B.