
Applied Statistics and Probability for Engineers
6th Edition
ISBN: 9781118539712
Author: Douglas C. Montgomery
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Question
Chapter 12.4, Problem 57E
a.
To determine
Construct the 99% confidence intervals for
b.
To determine
Find the 99% confidence intervals of the terms in part a after adding the interaction term
Compare the lengths of these intervals with the ones in part a and explain whether this gives any information of the contribution of the interaction term in the model.
Expert Solution & Answer

Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
1 No.
2
3
4
Binomial Prob.
X
n
P
Answer
5
6 4
7
8
9
10
12345678
8
3
4
2
2552
10
0.7
0.233
0.3
0.132
7
0.6
0.290
20
0.02
0.053
150
1000
0.15
0.035
8
7
10
0.7
0.383
11
9
3
5
0.3
0.132
12
10
4
7
0.6
0.290
13
Poisson Probability
14
X
lambda
Answer
18 4
19
20
21
22
23 9
15
16
17 3
1234567829
3
2
0.180
2
1.5
0.251
12
10
0.095
5
3
0.101
7
4
0.060
3
2
0.180
2
1.5
0.251
24 10
12
10
0.095
step by step on Microssoft on how to put this in excel and the answers please
Find binomial probability if:
x = 8, n = 10, p = 0.7
x= 3, n=5, p = 0.3
x = 4, n=7, p = 0.6
Quality Control: A factory produces light bulbs with a 2% defect rate. If a random sample of 20 bulbs is tested, what is the probability that exactly 2 bulbs are defective? (hint: p=2% or 0.02; x =2, n=20; use the same logic for the following problems)
Marketing Campaign: A marketing company sends out 1,000 promotional emails. The probability of any email being opened is 0.15. What is the probability that exactly 150 emails will be opened? (hint: total emails or n=1000, x =150)
Customer Satisfaction: A survey shows that 70% of customers are satisfied with a new product. Out of 10 randomly selected customers, what is the probability that at least 8 are satisfied? (hint: One of the keyword in this question is “at least 8”, it is not “exactly 8”, the correct formula for this should be = 1- (binom.dist(7, 10, 0.7,…
Kate, Luke, Mary and Nancy are sharing a cake. The cake had previously been divided into four slices (s1, s2, s3 and s4). What is an example of fair division of the cake
S1
S2
S3
S4
Kate
$4.00
$6.00
$6.00
$4.00
Luke
$5.30
$5.00
$5.25
$5.45
Mary
$4.25
$4.50
$3.50
$3.75
Nancy
$6.00
$4.00
$4.00
$6.00
Chapter 12 Solutions
Applied Statistics and Probability for Engineers
Ch. 12.1 - 12.1. Exercise 11.1 described a regression model...Ch. 12.1 - 12.2. A class of 63 students has two hourly exams...Ch. 12.1 - 12.3. Can the percentage of the workforce who are...Ch. 12.1 - Prob. 4ECh. 12.1 - Prob. 5ECh. 12.1 - Prob. 6ECh. 12.1 - Prob. 7ECh. 12.1 - 12-8. You have fit a multiple linear regression...Ch. 12.1 - 12-9. The data from a patient satisfaction survey...Ch. 12.1 - 12-10. The electric power consumed each month by a...
Ch. 12.1 - 12-11. Table E12-3 provides the highway gasoline...Ch. 12.1 - 12-12. The pull strength of a wire bond is an...Ch. 12.1 - Prob. 13ECh. 12.1 - Prob. 14ECh. 12.1 - 12-15. An article in Electronic Packaging and...Ch. 12.1 - 12-16. An article in Cancer Epidemiology,...Ch. 12.1 - Prob. 17ECh. 12.1 - Prob. 18ECh. 12.1 - Prob. 19ECh. 12.1 - Prob. 20ECh. 12.1 - Prob. 21ECh. 12.1 - Prob. 22ECh. 12.1 - 12-23. A study was performed on wear of a bearing...Ch. 12.1 - Prob. 24ECh. 12.2 - 12-25. Recall the regression of percent of body...Ch. 12.2 - Prob. 27ECh. 12.2 - Prob. 28ECh. 12.2 - 12-29. Consider the following computer...Ch. 12.2 - 12-30. You have fit a regression model with two...Ch. 12.2 - 12-31. Consider the regression model fit to the...Ch. 12.2 - 12-32. Consider the absorption index data in...Ch. 12.2 - Prob. 33ECh. 12.2 - Prob. 34ECh. 12.2 - 12-35. Consider the gasoline mileage data in...Ch. 12.2 - Prob. 36ECh. 12.2 - Prob. 37ECh. 12.2 - Prob. 38ECh. 12.2 - 12-39. Consider the regression model fit to the...Ch. 12.2 - Prob. 40ECh. 12.2 - Prob. 41ECh. 12.2 - Prob. 42ECh. 12.2 - 12-43. Consider the NFL data in Exercise...Ch. 12.2 - Prob. 44ECh. 12.2 - 12-45. Consider the bearing wear data in Exercise...Ch. 12.2 - 12-46. Data on National Hockey League team...Ch. 12.2 - Prob. 47ECh. 12.2 - Prob. 48ECh. 12.4 - Prob. 52ECh. 12.4 - 12-53. Consider the regression model fit to the...Ch. 12.4 - 12-55. Consider the semiconductor data in Exercise...Ch. 12.4 - 12-56. Consider the electric power consumption...Ch. 12.4 - Prob. 57ECh. 12.4 - Prob. 58ECh. 12.4 - 12-59. Consider the regression model fit to the...Ch. 12.4 - Prob. 60ECh. 12.4 - 12-61. Consider the regression model fit to the...Ch. 12.4 - Prob. 62ECh. 12.4 - Prob. 63ECh. 12.4 - Prob. 64ECh. 12.4 - Prob. 65ECh. 12.4 - Prob. 66ECh. 12.4 - Prob. 67ECh. 12.4 - 12-68. Consider the NHL data in Exercise...Ch. 12.5 - 12-69. Consider the gasoline mileage data in...Ch. 12.5 - Prob. 70ECh. 12.5 - Prob. 71ECh. 12.5 - Prob. 72ECh. 12.5 - 12-73. Consider the regression model fit to the...Ch. 12.5 - Prob. 74ECh. 12.5 - Prob. 75ECh. 12.5 - Prob. 76ECh. 12.5 - Prob. 77ECh. 12.5 - Prob. 78ECh. 12.5 - Prob. 79ECh. 12.5 - 12-80. Fit a model to the response PITCH in the...Ch. 12.5 - Prob. 81ECh. 12.6 - 12-84. An article entitled “A Method for Improving...Ch. 12.6 - Prob. 85ECh. 12.6 - Prob. 86ECh. 12.6 - Prob. 87ECh. 12.6 - 12-88. Consider the arsenic concentration data in...Ch. 12.6 - Prob. 89ECh. 12.6 - Prob. 90ECh. 12.6 - 12-91. Consider the X-ray inspection data in...Ch. 12.6 - 12-92. Consider the electric power data in...Ch. 12.6 - Prob. 93ECh. 12.6 - Prob. 94ECh. 12.6 - 12-95. Consider the gray range modulation data in...Ch. 12.6 - 12-96. Consider the nisin extraction data in...Ch. 12.6 - Prob. 97ECh. 12.6 - Prob. 98ECh. 12.6 - Prob. 99ECh. 12.6 - 12-100. Consider the arsenic data in Exercise...Ch. 12.6 - 12-101. Consider the gas mileage data in Exercise...Ch. 12.6 - Prob. 102ECh. 12.6 - Prob. 103ECh. 12.6 - Prob. 104ECh. 12.6 - Prob. 105ECh. 12 - Prob. 106SECh. 12 - 12-107. Consider the following inverse of the...Ch. 12 - 12-108. The data shown in Table E12-14 represent...Ch. 12 - Prob. 109SECh. 12 - Prob. 111SECh. 12 - Prob. 112SECh. 12 - 12-113. Consider the jet engine thrust data in...Ch. 12 - 12-114. Consider the electronic inverter data in...Ch. 12 - 12-115. A multiple regression model was used to...Ch. 12 - Prob. 116SECh. 12 - 12-117. An article in the Journal of the American...Ch. 12 - 12-118. Exercise 12-9 introduced the hospital...Ch. 12 - Prob. 119SECh. 12 - Prob. 120SECh. 12 - 12-121. A regression model is used to relate a...Ch. 12 - Prob. 122SECh. 12 - Prob. 123SECh. 12 - Prob. 124SECh. 12 - Prob. 125SE
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, statistics and related others by exploring similar questions and additional content below.Similar questions
- Faye cuts the sandwich in two fair shares to her. What is the first half s1arrow_forwardQuestion 2. An American option on a stock has payoff given by F = f(St) when it is exercised at time t. We know that the function f is convex. A person claims that because of convexity, it is optimal to exercise at expiration T. Do you agree with them?arrow_forwardQuestion 4. We consider a CRR model with So == 5 and up and down factors u = 1.03 and d = 0.96. We consider the interest rate r = 4% (over one period). Is this a suitable CRR model? (Explain your answer.)arrow_forward
- Question 3. We want to price a put option with strike price K and expiration T. Two financial advisors estimate the parameters with two different statistical methods: they obtain the same return rate μ, the same volatility σ, but the first advisor has interest r₁ and the second advisor has interest rate r2 (r1>r2). They both use a CRR model with the same number of periods to price the option. Which advisor will get the larger price? (Explain your answer.)arrow_forwardQuestion 5. We consider a put option with strike price K and expiration T. This option is priced using a 1-period CRR model. We consider r > 0, and σ > 0 very large. What is the approximate price of the option? In other words, what is the limit of the price of the option as σ∞. (Briefly justify your answer.)arrow_forwardQuestion 6. You collect daily data for the stock of a company Z over the past 4 months (i.e. 80 days) and calculate the log-returns (yk)/(-1. You want to build a CRR model for the evolution of the stock. The expected value and standard deviation of the log-returns are y = 0.06 and Sy 0.1. The money market interest rate is r = 0.04. Determine the risk-neutral probability of the model.arrow_forward
- Several markets (Japan, Switzerland) introduced negative interest rates on their money market. In this problem, we will consider an annual interest rate r < 0. We consider a stock modeled by an N-period CRR model where each period is 1 year (At = 1) and the up and down factors are u and d. (a) We consider an American put option with strike price K and expiration T. Prove that if <0, the optimal strategy is to wait until expiration T to exercise.arrow_forwardWe consider an N-period CRR model where each period is 1 year (At = 1), the up factor is u = 0.1, the down factor is d = e−0.3 and r = 0. We remind you that in the CRR model, the stock price at time tn is modeled (under P) by Sta = So exp (μtn + σ√AtZn), where (Zn) is a simple symmetric random walk. (a) Find the parameters μ and σ for the CRR model described above. (b) Find P Ste So 55/50 € > 1). StN (c) Find lim P 804-N (d) Determine q. (You can use e- 1 x.) Ste (e) Find Q So (f) Find lim Q 004-N StN Soarrow_forwardIn this problem, we consider a 3-period stock market model with evolution given in Fig. 1 below. Each period corresponds to one year. The interest rate is r = 0%. 16 22 28 12 16 12 8 4 2 time Figure 1: Stock evolution for Problem 1. (a) A colleague notices that in the model above, a movement up-down leads to the same value as a movement down-up. He concludes that the model is a CRR model. Is your colleague correct? (Explain your answer.) (b) We consider a European put with strike price K = 10 and expiration T = 3 years. Find the price of this option at time 0. Provide the replicating portfolio for the first period. (c) In addition to the call above, we also consider a European call with strike price K = 10 and expiration T = 3 years. Which one has the highest price? (It is not necessary to provide the price of the call.) (d) We now assume a yearly interest rate r = 25%. We consider a Bermudan put option with strike price K = 10. It works like a standard put, but you can exercise it…arrow_forward
- In this problem, we consider a 2-period stock market model with evolution given in Fig. 1 below. Each period corresponds to one year (At = 1). The yearly interest rate is r = 1/3 = 33%. This model is a CRR model. 25 15 9 10 6 4 time Figure 1: Stock evolution for Problem 1. (a) Find the values of up and down factors u and d, and the risk-neutral probability q. (b) We consider a European put with strike price K the price of this option at time 0. == 16 and expiration T = 2 years. Find (c) Provide the number of shares of stock that the replicating portfolio contains at each pos- sible position. (d) You find this option available on the market for $2. What do you do? (Short answer.) (e) We consider an American put with strike price K = 16 and expiration T = 2 years. Find the price of this option at time 0 and describe the optimal exercising strategy. (f) We consider an American call with strike price K ○ = 16 and expiration T = 2 years. Find the price of this option at time 0 and describe…arrow_forward2.2, 13.2-13.3) question: 5 point(s) possible ubmit test The accompanying table contains the data for the amounts (in oz) in cans of a certain soda. The cans are labeled to indicate that the contents are 20 oz of soda. Use the sign test and 0.05 significance level to test the claim that cans of this soda are filled so that the median amount is 20 oz. If the median is not 20 oz, are consumers being cheated? Click the icon to view the data. What are the null and alternative hypotheses? OA. Ho: Medi More Info H₁: Medi OC. Ho: Medi H₁: Medi Volume (in ounces) 20.3 20.1 20.4 Find the test stat 20.1 20.5 20.1 20.1 19.9 20.1 Test statistic = 20.2 20.3 20.3 20.1 20.4 20.5 Find the P-value 19.7 20.2 20.4 20.1 20.2 20.2 P-value= (R 19.9 20.1 20.5 20.4 20.1 20.4 Determine the p 20.1 20.3 20.4 20.2 20.3 20.4 Since the P-valu 19.9 20.2 19.9 Print Done 20 oz 20 oz 20 oz 20 oz ce that the consumers are being cheated.arrow_forwardT Teenage obesity (O), and weekly fast-food meals (F), among some selected Mississippi teenagers are: Name Obesity (lbs) # of Fast-foods per week Josh 185 10 Karl 172 8 Terry 168 9 Kamie Andy 204 154 12 6 (a) Compute the variance of Obesity, s²o, and the variance of fast-food meals, s², of this data. [Must show full work]. (b) Compute the Correlation Coefficient between O and F. [Must show full work]. (c) Find the Coefficient of Determination between O and F. [Must show full work]. (d) Obtain the Regression equation of this data. [Must show full work]. (e) Interpret your answers in (b), (c), and (d). (Full explanations required). Edit View Insert Format Tools Tablearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- MATLAB: An Introduction with ApplicationsStatisticsISBN:9781119256830Author:Amos GilatPublisher:John Wiley & Sons IncProbability and Statistics for Engineering and th...StatisticsISBN:9781305251809Author:Jay L. DevorePublisher:Cengage LearningStatistics for The Behavioral Sciences (MindTap C...StatisticsISBN:9781305504912Author:Frederick J Gravetter, Larry B. WallnauPublisher:Cengage Learning
- Elementary Statistics: Picturing the World (7th E...StatisticsISBN:9780134683416Author:Ron Larson, Betsy FarberPublisher:PEARSONThe Basic Practice of StatisticsStatisticsISBN:9781319042578Author:David S. Moore, William I. Notz, Michael A. FlignerPublisher:W. H. FreemanIntroduction to the Practice of StatisticsStatisticsISBN:9781319013387Author:David S. Moore, George P. McCabe, Bruce A. CraigPublisher:W. H. Freeman

MATLAB: An Introduction with Applications
Statistics
ISBN:9781119256830
Author:Amos Gilat
Publisher:John Wiley & Sons Inc

Probability and Statistics for Engineering and th...
Statistics
ISBN:9781305251809
Author:Jay L. Devore
Publisher:Cengage Learning

Statistics for The Behavioral Sciences (MindTap C...
Statistics
ISBN:9781305504912
Author:Frederick J Gravetter, Larry B. Wallnau
Publisher:Cengage Learning

Elementary Statistics: Picturing the World (7th E...
Statistics
ISBN:9780134683416
Author:Ron Larson, Betsy Farber
Publisher:PEARSON

The Basic Practice of Statistics
Statistics
ISBN:9781319042578
Author:David S. Moore, William I. Notz, Michael A. Fligner
Publisher:W. H. Freeman

Introduction to the Practice of Statistics
Statistics
ISBN:9781319013387
Author:David S. Moore, George P. McCabe, Bruce A. Craig
Publisher:W. H. Freeman
Hypothesis Testing using Confidence Interval Approach; Author: BUM2413 Applied Statistics UMP;https://www.youtube.com/watch?v=Hq1l3e9pLyY;License: Standard YouTube License, CC-BY
Hypothesis Testing - Difference of Two Means - Student's -Distribution & Normal Distribution; Author: The Organic Chemistry Tutor;https://www.youtube.com/watch?v=UcZwyzwWU7o;License: Standard Youtube License