Loose-leaf For Applied Statistics In Business And Economics
Loose-leaf For Applied Statistics In Business And Economics
5th Edition
ISBN: 9781259328527
Author: David Doane, Lori Seward Senior Instructor of Operations Management
Publisher: McGraw-Hill Education
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Chapter 7, Problem 99CE

A multiple-choice exam has 100 questions. Each question has four choices, (a) What minimum score should be required to reduce the chance of passing by random guessing to 5 percent? (b) To 1 percent? (c) Find the quartiles for a guesser.

a.

Expert Solution
Check Mark
To determine

Find the minimum score should be required to reduce the chance of passing by random guessing to 5%.

Answer to Problem 99CE

The minimum score should be required to reduce the chance of passing by random guessing to 5% is 32.12.

Explanation of Solution

Calculation:

It is given that a multiple-choice exam has 100 questions, with 4 options each.

Assume that the random variable X defines the number of correct answers by a student randomly guessing the answers. Consider choosing a correct answer as a success. Then, X has a binomial distribution.

Only 1 out of the 4 options is correct for each question. Thus, the probability of success is 0.25(=14).

Normal distribution:

A continuous random variable X is said to follow normal distribution if the probability density function of X is,

f(x)=1σ2πe(xμ)22σ2,<x<, with mean μ and standard deviation σ.

Binomial distribution:

A discrete random variable X is said to follow binomial distribution if the probability mass function is defined as,

p(x)=Cnxπx(1π)nx, for all x=0,1,2,...,n., where the mean of the distribution is nπ and variance of the distribution is nπ(1π).

It is known that, when  nπ10 and n(1π)10,  it is best to use normal approximation, where mean of the normal distribution will be μ=nπ and the standard deviation of the normal distribution will  be σ=nπ(1π).

Here, n=100 and π=0.25.

Hence,

nπ=(100)(0.25)=25>10.

n(1π)=(100)(10.25)=(100)(0.75)=75>10.

As the conditions for approximation are satisfied, the normal approximation can be used.

The expected number of the random variable X is,

μ=nπ=25..

The standard deviation of the random variable X is,

σ=nπ(1π)=(100)(0.25)(0.75)=18.754.33.

The approximate normal probability that a student passes by random guessing is 5%.

Denote x1 as the minimum pass score so that the probability of passing by guessing is 5%. Thus, P(X>x1)=0.05.

Again, the probability P(X>x1) can be rewritten as,

P(X>x1)=1P(Xx1)0.05=1P(Xx1)P(Xx1)=10.05=0.95.

Variable value:

Software procedure:

Step-by-step software procedure to obtain variable value using EXCEL is as follows:

  • • Open an EXCEL file.
  • • In cell E1, enter the formula “=NORM.INV(0.95,25,4.33)”.
  • Output using EXCEL software is given below:

Loose-leaf For Applied Statistics In Business And Economics, Chapter 7, Problem 99CE , additional homework tip  1

Hence, P(X32.12)=0.95.

Therefore, x1=32.12.

Thus, the minimum score should be required to reduce the chance of passing by random guessing to 5% is 32.12.

b.

Expert Solution
Check Mark
To determine

Find the minimum score should be required to reduce the chance of passing by random guessing to 1%.

Answer to Problem 99CE

The minimum score should be required to reduce the chance of passing by random guessing to 1% is 35.07.

Explanation of Solution

Calculation:

Denote x2 as the minimum pass score so that the probability of passing by guessing is 1%. Thus, P(X>x2)=0.01.

Again, the probability P(X>x2) can be rewritten as,

P(X>x2)=1P(Xx2)0.01=1P(Xx2)P(Xx2)=10.01=0.99.

Variable value:

Software procedure:

Step-by-step software procedure to obtain variable value using EXCEL is as follows:

  • • Open an EXCEL file.
  • • In cell E1, enter the formula “=NORM.INV(0.99,25,4.33)”.
  • Output using EXCEL software is given below:

Loose-leaf For Applied Statistics In Business And Economics, Chapter 7, Problem 99CE , additional homework tip  2

Hence, P(X35.07)=0.99.

Therefore, x2=35.07.

Thus, the minimum score should be required to reduce the chance of passing by random guessing to 1% is 35.07.

c.

Expert Solution
Check Mark
To determine

Find the quartiles for a student who guesses.

Answer to Problem 99CE

The first and third quartiles of scores for a student who guesses are respectively 22.08 and 27.92.

Explanation of Solution

Calculation:

The first quartile of a distribution is the value of the variable, below which, 25% of the observations lie. In other words, the probability that an observation lies below the first quartile is 0.25.

Denote Q1 as the first quartile of this normal distribution. Thus, P(X<Q1)=0.25.

First quartile:

Software procedure:

Step-by-step software procedure to obtain the first quartile using EXCEL is as follows:

  • • Open an EXCEL file.
  • • In cell E1, enter the formula “=NORM.INV(0.25,25,4.33)”.
  • Output using EXCEL software is given below:

Loose-leaf For Applied Statistics In Business And Economics, Chapter 7, Problem 99CE , additional homework tip  3

Here, P(X<22.08)=0.25.

Hence, Q1=22.08.

The third quartile of a distribution is the value of the variable, below which, 75% of the observations lie. In other words, the probability that an observation lies below the third quartile is 0.75.

Denote Q3 as the third quartile of this normal distribution. Thus, P(X<Q3)=0.75.

Third quartile:

Software procedure:

Step-by-step software procedure to obtain the third quartile using EXCEL is as follows:

  • • Open an EXCEL file.
  • • In cell E1, enter the formula “=NORM.INV(0.75,25,4.33)”.
  • Output using EXCEL software is given below:

Loose-leaf For Applied Statistics In Business And Economics, Chapter 7, Problem 99CE , additional homework tip  4

Here, P(X<27.92)=0.75.

Hence, Q3=27.92.

Thus, the first and third quartiles of scores for a student who guesses are respectively 22.08 and 27.92.

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Chapter 7 Solutions

Loose-leaf For Applied Statistics In Business And Economics

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