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b) Your team’s Lead Analyst thinks the average is at most 17 jump days per year.
Based on your confidence interval from part a, can you reject her claim (please
explain)? [1 point]
c) What sample size would we need to determine the average number of jump
days within plus or minus .5 days at 95% confidence? [4 points]
2) Your firm also wants to know some things about its more than 500 investors. A survey of
61 investors shows that 27 of them are considered “passive” investors in the firm, in
that they change their investment level less than twice per month (versus “active”
investors who change their level more often).
a) Assuming this is a valid, random sample, provide a 99% confidence interval for
the percentage of investors that are passive, to the nearest one-tenth of a
percent. [5 points]
b) What sample size would we need to provide the percentage of investors who are
passive within plus or minus 10 percent at 99% confidence? [4 points]
c) Suppose the firm contacted all of its investors and the 43 in the survey were the
only investors that responded. What kind of sampling bias is most likely to occur
in that situation (please briefly explain)? [2 points]
3) Just one day before a meeting with your manager, he asks you to get a sample of the
planned new investment from your investors over the next year. You call as many as
possible and end up with a sample of the first 26 investors who answer. The average
planned investment among those 26 investors is $527,000, with a standard deviation of
$150,000.
a) Assume that this is a valid, random sample and that planned investments are
normally distributed. What is the 95% confidence interval for the average
investor’s planned next-year investment (specify your values to the nearest $1)?
[5 points]
b) Obviously, this is not a random sample. What kind of sampling did the analyst
use to collect this sample (please briefly explain)? [2 points]
c) Name one kind of bias that might be present in this sample and why. [2 points]
4) A large firm wants to figure out whether employees who work from home are more
productive, less productive or just as productive as those who work in the office. For
three months, they track 100 randomly selected employees, 45 of whom work from
home, and 55 of whom work in the office, and assign a productivity score between 0
and 100 to each of those employees. They find the following summary of the scores
from each sample:
Work from home Work in office
Sample size 45 55
Average productivity score 63 72
Standard deviation 15.4 19.8
a) What is the probability that a sample of size 55 from the “Work from home”
population (i.e., with a mean score of 63 and standard deviation 15.4) would
have a mean of 72 or greater? [5 points]
b) Based on your result from part a, do you think we can confidently say the
average productivity of a “Work in office” employee is higher than for a “Work
from home” employee? Why or why not? [2 points]
c) Calculate a 95% confidence interval for the mean of each sample (you can
assume that each sample’s standard deviation is the population standard
deviation for that type of employee). [10 points]
d) Based on your results from part c, can we say with 95% confidence that the
mean productivity is different for “Work in office” and “Work from home”
employees? Why or why not? [3 points]