FACULTY OF COMMERCE AND LAW

BACHELOR OF COMMERCE (HONOURS)

ACCOUNTING/BANKING & FINANCE/MARKETING/HUMAN
RESOURCE AND INDUSTRIAL RELATIONS
MANAGEMENT/INTERNAL AUDITING

BBFH103: BUSINESS STATISTICS I

April/May 2016

Time: 3 Hours

INSTRUCTIONS
Answer ALL questions in Section A and any Three in Section B. Show
all workings. Final answers should be given to 4 decimal places where
appropriate.

Use of silent and non-programmable scientific calculators is permissible.

List of Formulae is attached.

Graph paper and Statistical Tables will be provided by the Region.

Answer all questions in Answer Books provided.

BBFH103: BUSINESS STATISTICS I

PAGE 1 OF 11
Questions

Section A: Answer ALL questions in this Section.

[40 marks]

Question A1.

(a) (i) Distinguish between primary and secondary data. [2]

(ii) State two advantages of primary data over secondary data. [2]

(b) Define the following terms:

(i) response rate [1]

(ii) non-response bias [1]

(c) Mail surveys have poor response rates. Suggest how a researcher can improve the
response rate in mail surveys. [3]

Question A2.

An airtime vendor recorded the daily sales (in dollars) of each of two types of juice cards
that he sells over a few randomly selected days as shown below:

Buddie: 40 19 32 50 38 45 47 38 29 30 45 27 10 16 32 50 38 45
47 38 29 30 45 27 34 69 52 42 36 82 45

Easycall: 13 24 17 15 30 28 11 24 18 25 12 32 27 19 22 34 29 22
13 24 17 15 30 28 11 24 18 25

(a) Find for each type of juice card the:

i. mean, [4]

ii. mode, [2]

iii. median, [4]

iv. range, [2]

v. standard deviation, of the sales. [5]

(b) Calculate the coefficient of variation for each type of juice card. Hence, determine
which type of juice cards has more consistent sales. [5]

BBFH103: BUSINESS STATISTICS I

PAGE 2 OF 11
(c) The sales of each type of juice card was presented as shown in the diagrams below;

(i) What name do we give to the diagrams shown? [1]

(ii) Compare the skewness in the sales of the two types of juice cards. [2]

Question A3.

(a) Describe how a sample of 50 cars can be selected from cars being driven into a
parkade with a carrying capacity of 500 cars using systematic random sampling.
[4]

(b) Why is systematic random sampling often perceived as a quasi-random sampling

method? [2]

BBFH103: BUSINESS STATISTICS I

PAGE 3 OF 11
Section B (60 marks). Answer any three questions from this section. Each question
carries 20 marks.

Question B4.

The table below shows numbers of defective (X) items coming off a production line together
with their associated probabilities.

x 0 1 2 3
P (X = x) 0.10 0.30 0.45 0.15

(a) What is the most probable number of defective items that would come off the
production line? [2]

(b) Construct the cumulative probability distribution of the data, hence find P ( X  2) .
[5]
(c) Find the

(i) E ( X ) [3]

(ii) E (2 X  1) [4]

(d) Find the variance and standard deviation of the number of items coming off the
production line. [6]

Question B5.

The distribution of investors by value of shares (thousand dollars) in Earthly Pvt. Ltd
company is shown in the frequency table below.

Value ($000) 2.5 - 4.5 5.0 - 7.5 8.0 - 12.5 13.0 - 18.5 19.0 - 25.5
Number of 12 9 24 8 5
Investors

(a) Calculate the following:

i. mean, [3]

BBFH103: BUSINESS STATISTICS I

PAGE 4 OF 11
 ii. median, [3]

iii. mode, and [3]

iv. standard deviation, of share values. [5]

(b) Draw a histogram showing the distribution of share values in the company. Hence,
comment on the shape of the distribution. [6]

Question B6.

(a) State any four attributes of a good structured questionnaire. [4]

(b) State four possible reasons for collecting data from a representative sample of a
population instead of the whole population. [4]

(c) Only 20% of companies listed on the Zimbabwe Stock Exchange are expected to
declare a dividend this year. Suppose 10 listed companies on the bourse are to be
randomly selected.

(i) Find the expected number and standard deviation of companies that are
expected to declare a dividend this year. [5]

(ii) What is the probability that none of the listed companies will declare a dividend
this year? [3]

(iii) What is the probability that at least half of the companies will declare a dividend
this year? [4]

Question B7.

(a) On average a copy typist makes 2 errors per page. What is the probability that she
makes:

(i) no error if she is assigned to type a one page document? [3]

(ii) at most one error if she is assigned to type a two page document? [5]

(b) The monthly salaries earned by a sample of 20 salespersons employed in the motor
insurance industry are:

BBFH103: BUSINESS STATISTICS I

PAGE 5 OF 11
 Salary/($) Number of Employees
200 to less than 300 2
300 to less than400 4
400 to less than 500 8
500 to less than 600 5
600 to less than 700 1

(i) Estimate the average monthly salary of a salesperson in the industry. [3]

(ii) Construct a less than ogive of the data. [6]

(iii) What percentage of the salespersons earn a monthly salary that is at most
$450? [3]

BBFH103: BUSINESS STATISTICS I

PAGE 6 OF 11
LIST OF FORMULAE

9.1 Sampling Methods

Sampling ratio k in systematic sampling

N
k (2.1)
n

9.2 Methods of Displaying Data

Pie chart

no. of study units in category

Angle of sector =  3600
total no. of study units (4.1)

9.3 Measures for Describing Ungrouped Data

9.3.1 Measures of Central Tendency

Median
y n 1
a. if n is odd (5.1)
2

1
b. ( y n  y n  2 ) if n is even. (5.2)
2 2 2

N
1
Population mean,  
N
x
i 1
i (5.3)

1 n
Sample mean, x   xi
n i 1
(5.4)

9.3.2 Measures of position

th

The position of the p percentile is given by:

 n  1 p
100 (5.5)

BBFH103: BUSINESS STATISTICS I

PAGE 7 OF 11
9.3.3 Measures of dispersion

Range = highest observed value – lowest observed value (5.6)

Q3  Q1
Interquartile range = (5.7)

Q3  Q1
Semi- interquartile range = 2 (5.8)

1  n 2 1  n  
2
Sample variance (5.9)
s 
2
 xi  n  
n  1  i 1 i 1
xi 
 

1  N 2 1  N  
2

Population variance    xi  N  
2

N  i 1
xi 


 (5.10)
i 1

s
  100
Coefficient of variation (CV) x (5.11)

9.4 Measures for Describing Grouped Data

k  1 3.322 log n
Sturges formula (6.1)

9.4.1 Measures of Central Tendency

k

fx i i

Mean 
i 1
k

f
i 1
i
(6.2)

Median = Lm  Cm (n 2  Fm 1 )
fm (6.3)
Mode  Lm  C m ( f m  f m 1 )
2 f m  f m 1  f m 1 (6.4)

BBFH103: BUSINESS STATISTICS I

PAGE 8 OF 11
9.4.2 Measures of Position

Cq ( n 4  Fq 1 )
Lower quartile,Q1 = Lq 
fq (6.5)
Cq (3n 4  Fq 1 )
Upper quartile,Q3 = Lq 
fq (6.6)
kn
Cp(  F p 1 )
pth percentile Pk  L p  100
fp (6.7)

9.4.3 Measures of Dispersion

1 ( f i xi ) 2
2  ( f i xi2  )
N N
Population variance (6.8)

1 ( f i xi ) 2
s 
2
( f i xi 
2
)
n 1 n
Sample variance (6.9)

9.5 Introduction to Probability

Probability of an event, P ( E )  n( E )
n( S ) (7.1)

P ( A )  1  P ( A)
Rule of compliments (7.2)

Addition rule for non-mutually exclusive events:

P ( A  B )  P ( A or B )  P ( A)  P ( B )  P ( A  B ) (7.3)

Addition rule for mutually exclusive events:

P ( A  B )  P ( A or B )  P ( A)  P ( B ) (7.4)

Product Rule for independent events

P ( A  B )  P ( A and B )  P( A)  P ( B ) (7.5)

Conditional Probability

BBFH103: BUSINESS STATISTICS I

PAGE 9 OF 11
 P( A  B)
P( A / B)  P( B)  0
P( B) (7.6)

9.6 Discrete Probability Distributions

Expectation of a discrete random variable X

  E ( X )  all x xP ( X  x )
(8.1)

Expectation of a function of a random variable

E[ h( X )]   h( x) P ( X  x)
all x (8.2)

Expected value of a linear function of a random variable

E (aX  b)  aE ( X )  b
(8.3)

Variance of a discrete random variable

 2  Var ( X )  E ( X 2 )  [ E ( X )]2 (8.4)

Binomial probability distribution

 n
P ( X  x)    p x (1  p ) n  x for x = 0, 1, 2,… n. (8.5)
 x

If X~ B (n, p), then

E(X) = n p (8.6)
Var(X) = n p (1 – p) (8.7)

Poisson probability distribution

e  x
P ( X  x) 
x! for x = 0, 1, 2, … (8.8)

 
If X~ Po( ), then the mean and variance of X both equal to (8.9)

BBFH103: BUSINESS STATISTICS I

PAGE 10 OF 11
BBFH103: BUSINESS STATISTICS I
PAGE 11 OF 11