Answers to Sample Exam #1

ISDS 361B

ANSWERS TO SAMPLE EXAM #1

1. The worksheet CSUFLB gives the starting salaries of graduates in business disciplines from CalStateFullerton (FUL) and CalStateLong Beach (LB). To try to make a fair comparison, the experimental design consisted of taking a randomly selected accounting graduate from each school, a randomly selected MIS graduate from each school etc.

(a) Can you conclude that there is a difference in average starting salaries between Fullerton and Long Beach? (YES/NO) because p = .158 > .05.

(b) What is your point estimate and margin of error for the average difference in starting salaries between Fullerton and Long Beach?

Point estimate of difference: $2227 Margin of Error: ± $3576.19

2. The worksheet CAMPUS expands problem 1 to include the Fullerton, Long Beach, Los Angeles, San Diego and Pomona campuses.

Can you conclude that there are differences in the average starting salaries

between the campuses? (YES/NO) because p = .26 > .05

3. The worksheet GRAD5 expands problem 2 so that 5 graduates were selected from each discipline-campus pair.

(a) What assumptions do you need to make to analyze this problem?

(1) Salries for each campus-major pair are normally distributed;

(2) Standard deviations of slaries for each campus-major pair are equal;

(3) Sampling is random and independent

For this design, what are the:

Factors ____Campus and Major___

Levels Campus: Fullerton, Long Beach, etc.; Major: Accounting, Finance, etc.

Treatments Fullerton-Accounting; Fullerton-Finance; ….. Pomona-MIS______

Response Variable Starting Salary

Experimental Unit Graduates Surveyed

(b) Analyze this problem using EXCEL. What conclusions do you draw and why?

Cannot conclude interaction between campus and discipline becasue p-value for interaction = .318 > .05. Can conclude both campus (p = .00027) and discipline (p = 0 (almost)) act independently to affect salaries.

4. Health care and insurance are big industries in the U.S. You are interested in finding out if there is a difference in the amount of money collected for simple appendix operations for patients having no insurance, an HMO, private

insurance, Medicare only, or Medicare and supplemental insurance. File HMO gives the results of your survey of 6 randomly selected patients from each of the five groups.

(a) Show statistically that you can conclude there are differences in the average amount collected based on insurance coverage. There is a difference because

p = .00000316 < .05

(b) Which mean values do you conclude differ? Why?

No insurance differs from any Medicare +Supplement,from HMO, and from Medicare and private insurance differs from Medicare only. Their means differ by more than LSD = 755.78

5. Brides Magazine reports the average price of a full wedding has increased by

more than $2000 in the last 3 years. To try to verify this claim you randomly select the wedding costs from 20 weddings 3 years and 20 other weddings today. The results are on the worksheet BRIDE.

(a) Can you conclude that the average price of a full weddings today is greater than $20,000? (YES/NO) because p = .17 > .05

(b) Give a 95% confidence for the average price of full weddings 3 years ago.

$10,315.28  $16,714.72

(d) Give a 95% confidence interval for the average increase in wedding prices over the last three years. $2,103.39  $17,266.71

6. Two computer lines sold by FULLERTON COMPUTER are the low-end

F-machine which retails for under $700 and its top of the line computer, which

regardless of its configuration is known is the FUL-ACTION, that retails for

over $2500.

FULLERTON uses an exponential smoothing approach with a smoothing constant of .3 for models which have been determined to be stationary in nature.

It uses both a regression approach and Holt's technique with α = .1 and γ = .3 for models that exhibit linear trend; then it uses the MAD performance measure to determine the better model for a particular situation.

Demand over the last 20 weeks for the F-machine is in the worksheetFMACH and demand over the last 20 weeks for the FUL-ACTION machines is in the worksheet FULACT.

(a) What is the difference in philosophy between using Holt's approach and using

regression to forecast the future for models with trend?

Regression places equal weights on all time series values;

Holt’s places more weight on the more recent observations.

(b) What is your forecast for the next four weeks for demand for F-machines and

for FUL-ACTION Machines?

Week / F-Machine / Ful-Action
21 / 217 / 124
22 / 220 / 124
23 / 223 / 124
24 / 226 / 124