NATIONAL UNIVERSITY OF SCIENCE AND TECHNOLOGY

FACULTY OF COMMERCE
GRADUATE SCHOOL OF BUSINESS
MASTER OF BUSINESS ADMINISTRATION IN STRATEGIC MANAGEMENT
QUANTITATIVE MANAGEMENT

PRACTICE QUESTIONS

Question 1

The daily sales of a vegetable vendor over 30 randomly selected days are:

14; 21; 28; 17; 15; 34; 10; 18; 25; 30; 21; 15; 11; 28; 17; 20; 20; 29; 31; 24; 11; 19; 26; 34;
10; 16; 25; 30; 22; 17

Required

a) Find the point estimate of the population mean.

b) Find the point estimate for the variance.

Question 2

The weights (kg) of 20 bags of potatoes randomly selected from a truckload of potatoes from
a truckload of 250 bags of potatoes are:

10; 10; 9; 9; 10; 9; 10; 10; 11; 12; 14; 16; 13; 18; 21; 22; 25; 30; 29; 31

Required

Find the point estimate of the following:

a) Population mean weight, and

b) Population variance of the weight of all potatoes in the truck.

Question 3

1
The bank balances of 30 randomly selected savings accounts are:

200; 128; 132; 400; 380; 24; 267; 306; 86; 94; 125; 106; 249; 364; 59;

34; 126; 184; 230; 342; 311; 265; 46; 38; 89; 122; 241; 237; 98; 106

Required

Find the point estimates for the:

a) Population mean balance, and

b) Population variance of balances of all savings accounts

Question 4

In a study to determine the proportion of lecturers in Zimbabwe who are PhD holders, 800
lecturers out of a random sample of 2 000 teachers said they have PhD qualification.

Required:

a) Find a point estimate of the proportion of all Zimbabwean teachers who are PhD
holders.
b) If there are 15 000 lecturers altogether in Zimbabwe, how many have PhDs?

Question 5

An electrical firm supplies light bulbs that have a length of life that is approximately
normally distributed with a standard deviation of 20 hours. If a random sample of 40 bulbs
has an average life of 800 hours.

Required

Find:

a) A 95% confidence interval for the population mean life of all bulbs supplied by this
firm,
b) A 99% confidence interval for the population mean life of all bulbs supplied by this
firm.

Question 6

2
The burning times of a particular brand of candles imported from Zambia are known to be
normally distributed with a standard deviation of 5 minutes. The mean burning times of a
random sample of 20 candles was 3 hours.

Required

Find a 90% confidence interval for the mean burning time of all such candles.

Question 7

A survey of 400 company executives revealed that the average annual earnings of a CEO is
$200 000 with a standard deviation of $600.

Required

Find a 99% confidence interval for the true average annual earnings for all company
executives.

Question 8

A stock market analyst wanted to estimate the average return on a certain stock. A random
sample of 20 days yielded an average return of 12% and a standard deviation of 4%.

Required

Find a 95% confidence interval estimate for the average return on this stock.

Question 9

A random sample of 10 cigarettes of a certain type has an average nicotine content of 15

milligrams and a standard deviation of 2.5 milligrams.

Required

Find a 99% confidence interval for the true average nicotine content of all the cigarettes.

Question 10

In a survey of 300 company executives carried out by the ZCT, 81 executives said they are
willing to publicly disclose their annual salaries.

3
Required

Find a 99% confidence interval for the proportion of all executives who are willing to
disclose their annual salaries.

Question 11

A random sample of 400 customers who visited a retail shop was interviewed and 280 were
found to have a preference for a certain brand of toothpaste. Find a 90% confidence interval
for the proportion of the population of customers who prefer the particular brand of
toothpaste.

Question 12

Describe the importance of business statistics in decision making process in an organization.

Question 13
Given a set of raw data below:
2; 3; 2; 1; 4; 4; 4; 1; 1; 3; 2; 5; 3; 5; 1; 5; 1; 4; 2; 3; 0; 4; 1; 0; 3; 5; 2; 5; 0; 4; 1; 4; 0; 5; 2; 3;
0; 4; 4; 1; 2
Required
Construct a frequency distribution for the ungrouped data

Question 14

The following are the marks that were obtained by forty MBA students who set for a
Business Statistics examination at NUST.

56; 20; 70; 45; 50; 49; 62; 39; 41; 65; 25; 76; 59; 48; 55; 57; 71; 49; 42; 44;

63; 60; 41; 45; 50; 31; 35; 21; 58; 56; 77; 56; 63; 31; 39; 29; 49; 54; 64; 67

Required

Construct a grouped frequency distribution for the marks.

Question 15

4
The following table shows the marks that were obtained by a class of Business Statistics by a
class of MBA students:

Class interval Frequency

1–5 6
6 – 10 8
11 – 15 5
16 – 20 4
21 – 25 2
Required

a) Construct a frequency distribution for the marks.

b) Draw a histogram for the data

Question 16

The number of passengers that board a bus from town to NUST on a daily basis for a week is
given below:

Days Passengers
Monday 50
Tuesday 80
Wednesday 60
Thursday 60
Friday 150
Saturday 150
Sunday 50

Required

Construct a pie chart.

Question 17

The table below shows the maize yields for a farmer for 5 years

Years 2014 2015 2016 2017 2018 2019 2020

Yield (t) 10 12 18 25 42 40 36

5
Required

Construct a bar chart

Question 18

The table below shows the import and export of sugar in Zimbabwe for the years 2010 to
2014:

Years Imports Exports

2010 7 930 4 260
2011 8 830 5 225
2012 9 780 6 150
2013 11 720 7 340
2014 12 150 8 145

Required

Construct a multiple bar chart

Question 19

The table below shows the quantity in kilograms of Wheat, Barley and Oats produced by a
farmer from 2010 to 2013

Years Wheat Barley Oats

2010 34 000 34 000 27 000
2011 43 000 14 000 24 000
2012 43 000 16 000 27 000
2013 45 000 13 000 34 000

Required

6
Construct a component bar chart to illustrate this data.

Question 20

The following data shows the marks that were obtained by students in a test a lecturer
conducted for his class.

68; 65; 50; 40; 46; 56; 53; 70; 60; 85; 45; 46; 90; 95; 70; 86; 88

69; 94; 53; 56; 57; 54; 55; 67; 69; 71; 61; 72; 73; 80; 91; 64; 78

45; 44; 52; 57; 89; 69; 60; 32; 51; 74; 81; 81; 64; 59; 66; 62; 63

Required

a) Construct a frequency distribution for the grouped data.

b) Construct a frequency polygon for the data.
c) Construct a histogram for the data.

Question 21

Given the data: 10; 9; 11; 12; 13; 12; 12; 11; 10; 15; 16

Find the mean.

Question 22

Find the mean of the set of data given in the table below:

Marks 0 1 2 3 4 5 6 7 8 9
Frequenc 2 3 4 6 1 4 2 2 1 3
y

Question 23

The following table shows the distribution of weekly wages earned by 60 casual employees
of XYZ Ltd.

Wages Number of employees

40 – 49 4
50 – 59 12
60 – 69 18

7
 70 – 79 11
80 – 89 7
90 – 99 5
100 – 109 2
110 – 119 1

Required

Calculate:

a) Mean
b) Median
c) Mode
d) Range

Question 24

Given the data: 3; 2; 2; 5; 1; 4; 3; 2; 1; 5; and 2

Find the median

Question 25

The following table shows the distribution of masses of 120 logs of wood, correct to the
nearest a kg:

Mass (Kg) Frequency

15 – 24 4
25 – 29 35
30 – 34 49
35 – 39 24
40 – 49 6
50 – 60 2

Required

Calculate the median

Question 26

8
The marks of 40 students in Business Statistics test are given below:

6; 3; 5; 4; 1; 2; 4; 1; 6; 9; 10; 1; 2; 4; 6; 8; 2; 7; 3; 7; 2; 1; 1; 4; 5; 3; 2; 1; 9; 8; 10; 6; 5; 2; 2;
1; 1; 7; 9; 10

Required

a) Draw a frequency table for the ungrouped data.

b) State the mode and median of the distribution.
c) Calculate the mean of the distribution.

Question 27

The table below gives the distribution of marks of 50 students in an examination:

Marks (%) 20 – 29 30 – 39 40 – 49 50 – 59 60 – 69 70 – 79
Number of 4 7 20 9 6 4
students
Required

a) Mean
b) Median
c) Mode

Question 28

Given the data: 8; 4; 10; 12; 6; 7; 8; 15; 14

Calculate:

a) Mean
b) Variance.

Question 29

A case of 300 oranges was sampled, opened and each orange was weighed. The weight of
each orange was measured to the nearest a gram and recorded in the following table:

Weight (grams) Number of oranges

60 – 79 20
80 – 99 60

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 100 – 119 80
120 – 139 50
140 – 159 60
160 – 179 30

Required

Calculate:

a) Mean of the data.

b) Variance of the data
c) Standard deviation of the data

Question 30

A box contains 8 red marbles, 7 back marbles and 5 white marbles. If one marble is drawn at
random from the box, what is the probability that it will be:

a) Red
b) Black
c) Neither red nor black

Question 31

The probability that John will come to work on Friday is 0.2. what is the probability that John
will not come to work on Friday?

Question 32

It is known that 80% of the people who inquire about investment opportunities at the
Zimbabwe Investment Centre end up purchasing stock, and 30% end up purchasing bonds. It
is known known that 25% of the inquiries end up getting a diversified portfolio with bonds
and stocks. If a person is just making an enquiry, what is the probability that he will get stock
or bonds?

Question 33

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An organisation has 200 employees, 160 of them have at least some tertiary education and
105 of the employees underwent a national youth training programme. 85 employees have
tertiary education and also underwent national youth training. If an employee is randomly
selected, what is the probability that he has tertiary education or has had national youth
service training or both?

Question 34

A box contains 5 red balls and 4 white balls. Two balls are randomly selected from the box
one after another without replacement. Find the probability that:

a) Both balls are red.

b) The first ball is white and the second ball is red.
c) At least one ball is white.

Question 35

Distinguish between independent events and mutually exclusive events.

Question 36

John and Mary work in town at the same company. Mary travels to work by bus while John
cycles. The probabilities that John and Mary arrive late for work on a Friday is 0.35 and 0.46
respectively. Find the probability that both arrive late for work on a Friday.

Question 37

A loan officer at a Building Society knows that 15% of mortgage holders lose their jobs and
default on a loan repayment in the course of 10 years. The officer also knows that 30% of the
mortgage holders lose their jobs during this period. Given that one of the Society’s mortgage
holders just lost his job, what is the probability that he will default on loan repayment?

Question 38

A social analyst classified the employees of a certain organisation by gender and marital
status as follows:

Gender Married Not married Total

Male 85 45 130

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 Female 65 55 120
Total 150 100 250
If an employee is to be selected at random, find the probability that the employee is:

a) A female
b) Female and not married
c) Female or is not married
d) Female given the employee is not married.

Question 3 9

The Zimbabwe Safety Council analysed road traffic accidents causing injury to pedestrians
and the type of vehicles involved in the accidents. The following data was obtained:

Degree of injury Kombi Haulage truck Private car

Fatal 34 4 10
Serious 25 9 13
Non-serious 86 7 26

Required:

Calculate the probability that:

a) An injury to a pedestrian proves fatal

b) An accident involved a kombi
c) An accident involved a kombi or resulted in a non-serious injury
d) An accident involved a haulage truck and resulted in a serious injury.
e) An accident proves fatal given that it involved a haulage truck.

Question 40

The number of cars sold per day by a car dealer over the past 30 days are as follows:

Number of cars per day (x) 0 1 2 3

Number of days 12 6 9 3
Required

a) Find the probability distribution of the number of cars sold per day.
b) P( X ≤ 1)

12
 c) P( X> 2)

Question 4 1

The probability distribution of a random variable is tabled below:

x 0 1 2 3 4
P( X=x) 0.05 0.25 2p P 0.1

Find the value of p.

Question 42

The number of wooden chairs made per month by a backyard carpentry shop is a random
variable with the following probability distribution:

x 29 30 31 32
P( X=x) 0.4 0.3 0.2 0.1

Required

a) Obtain the cumulative probability distribution.

b) Find the probability that the number of chairs that will be made next month is at
least 30.
c) Find the probability that the number of chairs produced per month is at most 31.
d) Find the expected number of chairs produced per month.
e) Suppose that the carpentry shop incurs fixed monthly costs of $100 and an
additional construction cost of $5 per chair. Find the expected monthly cost of the
operation.

Question 43

A random sample of 10 MBA students obtained the following marks in Business Statistics
and Financial Management and Policy modules in their examinations:

Business Statistics 76 62 70 59 52 53 53 56 57 56

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 Financial Management and 80 68 73 63 65 68 65 63 65 66
Policy

Required

a) Calculate the Person’s correlation coefficient for the data.

b) Comment on the extent to which performance in Business Statistics is associated to
performance in Financial Management and Policy.

Question 44

The following are the number of hours which a random sample of ten students at MBA level
studied for an examination and the subsequent grades received by the students.

Hours studied 8 5 11 13 10 5 18 15 2 8
Grade 56 44 79 72 70 54 94 85 33 65

Required

Calculate Pearson’s Correlation Coefficient and comment on the results.

Question 45

A panel of two judges ranked the performance of 5 drama groups (A, B, C, D, E)

Drama group A B C D E
Judge 1 4 5 1 3 2
Judge 2 5 4 2 3 1

Calculate Spearman’s rank correlation coefficient and comment on your results.

Question 46

An examiner and a moderator marked 7 examination scripts during a standardisation process

and awarded the following percentage scores:

14
 Script number 1 2 3 4 5 6 7
Examiner 67 54 38 70 42 70 80
Moderator 58 60 38 67 44 69 76

Calculate Spearman’s rank correlation coefficient and comment on your results.

Question 47

The annual maize production (in metric tonnes) at Farm XYZ for the past ten years is shown
in the table below:

Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Production in matric 74 85 87 92 110 115 130 136 142 150
tonnes
Required

a) Determine the trend line for the data using the Least Squares Method.
b) Forecast production for the year 2012.

Question 48

The following data give the quarterly sales figures for a retail outlet for the period 2002 to
2004:

Year Quarter 1 Quarter 2 Quarter 3 Quarter 4

2002 10 12 13 11
2003 12 15 16 13
2004 14 16

Required

a) Determine the trend line using the Least Squares Method.

b) Forecast the sales for the last quarter of 2004.

Question 49

15
The daily sales of an airtime vendor over 12 days are recorded below:

37; 24; 62; 80; 77; 95; 94; 133; 148; 155; 128; 161

Calculate a 3-point moving average of the sales.

Question 50

The data below shows the sales of a seasoned product at a retail outlet over three years:

Year Quarter 1 Quarter 2 Quarter 3 Quarter 4

1 14 000 32 000 33 000 6 000
2 16 000 35 000 36 000 7 000
3 15 000 38 000 41 000 8 000

Required

a) Calculate the four point moving averages for the series.

b) Plot the four-point moving averages series on the same graph as the original series.
c) Calculate adjusted seasonal indexes of the data.
d) Obtain the deseasonalised series of the data.

Question 51

A local church organization recorded the following quarterly amounts of the tithes paid by its
members for the period 2010 to 2012:

Year Quarter 1 Quarter 2 Quarter 3 Quarter 4

2010 100 000 120 000 132 000 110 000
2011 125 000 156 000 168 000 130 000
2012 141 000 164 000 180 000 200 000

Required

a) Draw a time series plot of the data and comment on the trend shown.
b) Obtain a centred 4-point moving average of the series and use it to calculate adjusted
seasonal indexes for the data.
c) Find the deseasonalised series of the data.
d) Forecast the quarterly amounts of tithes for the year 2013.

16
Question 52

The average weekly earnings of all bus marshals is reported to be $180. You believe it is too
low. You collect a random sample of 100 rank marshals and find that the weekly average is
$250 with a standard deviation of $20. Conduct the test at 10% level of significance.

Question 53

In an advertisement, it is claimed that a certain brand of air freshener will last on average at
least 40 days. A random sample of 12 households took the following number of days to use
up the air freshener:

28; 41; 36; 50; 17; 39; 21; 64; 26; 30; 42; 12

Test the claim made for the product using a 5% level of significance.

Question 54

Average total daily sales of a fruits vendor are known to be at most $26. The vendor recently
changed his site of operation and moved to a new site at a busy street corner. He now wants
to know whether his daily sales have improved since then. A random sample of 16 trading
days gave an average of $30 with a standard deviation of $5. Does the data provide evidence
that the vendor’s average total daily sales have improved? Use ∝=0.05 .

Question 55

A graduate student comes out of college with an average fees debt of $1 500. A sample of
200 graduates showed that the average debt was $900 with a standard deviation of $120.
Carry out the test at the 5% level of significance.

Question 56

The Traffic Safety Council of Zimbabwe claims that at least 65% of all road accidents are
due to human error. In a random sample of 500 road accidents, it was found that 342
accidents were due to human error. Use 5% level of significance to test the claim.

Question 57

17
A credit controller of a clothing retail chain estimates that 20% of their customers default on
their monthly bill payment. A random sample of 400 accounts indicated that 130 accounts
were at least one month in arrears. Does the data provide evidence to support the credit
controller’s claim? Use 10% level of significance to test the claim.

Question 58

a) Why is it important for managers to study Business Statistics?

b) Distinguish between the two main branches of Business Statistics.

Question 59

a) Give three examples of a continuous random variable.

b) Classify the following random variables as being discrete or continuous variable:
i. Number of people in a church.
ii. Households income.
iii. Average daily temperatures.
iv. Distance travelled to school by a group of students
v. Number of phone calls recovered per day.

Question 60

a) What is the difference between ratio data and interval data?

b) Identify the measurement scale which is appropriate for each of the following data:
i. Prices of residential stands.
ii. Star ratings of hotels.
iii. House numbers in a street.
iv. Daily sales of a vegetable vendor.
v. Shoe sizes.

Question 61

a) Distinguish between primary data and secondary data.

b) Discuss the advantages of primary data and secondary data.

18
Question 62

Giving suitable examples, distinguish between the following types of data:

a) Continuous data and discrete data.

b) Soft data and hard data.
c) Time series data and cross-sectional data.

Question 63

A bank has 500 employees of which 250 are stationed in Harare branch, 200 at a Bulawayo
branch and 50 in Gweru. Managers at the bank intends to select a random sample of 40
employees in participate in a study.

Required

Determine how management can use stratified random sampling with proportional allocation
to select the 40 employees.

Question 64

The daily sales of an airtime vendor over 20 randomly selected days are:

53; 59; 74; 28; 61; 46; 70; 54; 48; 56; 36; 34; 63; 59; 38; 52; 51; 44; 49; 66

Produce a stem and leaf display to show this data.

Question 65

The prices of a textbook in 12 randomly selected shops are:

39; 43; 48; 51; 47; 42; 38; 48; 52; 40; 49; 54

Find the:

a) Mean
b) Median
c) Mode

Question 64

19
Draw a box-and- whisker plot of the following data:

10; 5; 14; 11; 16; 24; 21; 12; 16; 20; 22; 15; 24; 18; 10; 14; 19; 8; 12; 20

Question 65

The ages of a random sample of 10 hospital doctors are as follows:

26; 45; 37; 34; 29; 56; 74; 40; 48; 45;

Find the:

a) Mean
b) Variance
c) Standard deviation

Question 66

The number of vehicle accidents recorded in eleven different towns during the last Heroes
holiday was as follows:

8; 12; 10; 6; 11; 15; 6; 4; 4; 8; 7

Find the:

a) Mean
b) Median
c) Mode
d) Variance and
e) Standard deviation of the data.

Question 67

The amounts spent by 100 customers who came in during the first day of clearance sale at a
clothing retail shop are shown in the table below:

Amount spent Number of customers

20
 0 to less than 100 23
100 to less than 200 30
200 to less than 300 22
300 to less than 400 15
400 and above 10

Required

a) Construct a histogram and a frequency polygon of the distribution.

b) Comment on the relationship between a histogram and frequency polygon.

Question 68

An organisation recorded monthly medical expenses incurred by families of 30 randomly

selected employees.

Amount Number of employees

1 – 10 3
11 – 20 7
21 – 30 11
31 – 40 5
41 - 50 4

Required

Calculate:

a) Mean
b) Median
c) Mode
d) Variance
e) Standard deviation
f) Lower quartile
g) Upper quartile

Question 69

21
The annual profits made by a random sample of 40 companies in the textile industry are
shown in the following table:

Profit Number of companies

10 but less than 20 3
20 but less than 30 7
30 but less than 40 12
40 but less than 50 10
50 but less than 60 5
60 but less than 70 3

Required

Calculate:

a) Mean
b) Median
c) Mode
d) Semi-interquartile range
e) Variance
f) Standard deviation

Question 70

The numbers of customers visiting a car sale on 30 randomly selected days are as follows:

16; 27; 21; 34; 49; 19; 22; 14; 2; 27; 38; 12; 19; 43; 24; 24; 23; 21; 32; 26; 38; 9; 17; 20; 12;
25; 24; 31; 13; 22

Required

Construct a grouped distribution table for the data.

Question 71

The HR department of an insurance company analysed the qualifications profile of their 129
managers in terms of their highest qualification achieved. The findings are shown in the
cross-tabulation table below:

Qualification Section Head Dept Head Division Head

22
 A Level 28 14 ?
Diploma 20 24 6
Degree ? 10 14
Total 53 ? 28

a) Define the two random variables, their measurement scale and data type.
b) Complete the above cross-tabulation table (joint frequency table)
c) What is the probability that the manager selected at random?
i. Has only an A level certificate?
ii. Is a section head and has a degree?
iii. Is a department head given that the manager has a diploma?
iv. Is division head?
v. Is either a division head or a section head?
vi. Has either an A Level certificate. Or a diploma, or a degree?
vii. Has a degree given that the person is a department head?
viii. Is either a division head or has a diploma or both?
d) For each probability calculated in (c) above, state:
i. The type of probability (i.e. marginal. Joint or conditional).
ii. Which probability rule, if any, was applied (i.e. addition rule or multiplication
rule).

Question 72

Discuss the reasons why probability sampling methods are preferred to non-probabilistic
sampling methods. (25 Marks)

Question 73

The number of bicycles sold monthly by a bicycle dealer was:

25; 18; 30; 18; 20; 19; 30; 16; 36; 24

Required

a) Find the mean and median number of bicycles sold monthly. Interpret each descriptive
statistics measure. (3 marks)

23
b) Find the range, variance and standard deviation of the number of bicycles sold monthly.
Interpret the range and standard deviation measures. (4 Marks)
c) Calculate the lower and upper quartiles of monthly bicycle sales. Interpret the results.
(3 Marks)
d) Use the appropriate skewness formula to estimate the degree of symmetry in the
distribution of monthly bicycle sales. Interpret its meaning. (2 Marks)
e) Construct a box plot of monthly bicycle sales. Interpret the plot. (2 Marks)

Question 74

The Herald Newspaper in Zimbabwe conducted a survey amongst a random cross-section of

its subscriber readers to identify the popularity of the various sections of the newspaper
amongst all its readers.

For each of the following random variables, state the data type of each random variable
(categorical or numeric), the measurement scale (nominal, ordinal, interval or ratio scaled)
and whether it is discrete or continuous.

a) Ages of athletes in a marathon. (1 Marks)

b) Floor area of Pick and Pay Stores. (1 Marks)
c) Highest qualification of employees in an organisation. (1 Marks)
d) Marital status of employees. (1 Marks)
e) Different types of aircrafts used by Air Zimbabwe for domestic flights. (1 Marks)
f) Types of child abuse (physical, sexual, emotional or verbal). (1 Marks)
g) Performance appraisal rating scores assigned to employees. (1 Marks)
h) Ranked preferences of employees of employees to three different pay schemes. (1
Marks)
i) Masses (in kg) of bags of potatoes. (1 Marks)
j) Brand of coffee you prefer. (1 Marks)
k) Time taken (in minutes) to travel to work. (1 Marks)
l) Grades used to classify red meat (prime, super, first grade and standard). (1 marks)
m) Monthly premiums payable on life assurance policies. (1 Marks)

Question 75

24
Fair Lady magazine believes that it has a 38% share of the national female readership market
of women’s magazines. When 2000 readers of women’s magazines were randomly selected
and interviewed, 700 stated that they read Fair Lady regularly.

a) What is the random variable of interest? (1 Mark)

b) What is the population of interest? (1 Mark)
c) What is the sample? (1 Mark)
d) What is the sampling unit in this scenario? (1 Mark)
e) What percentage of readers interviewed read Fair Lady regularly? Is this a statistic or
parameter? Explain your answer. (1 Mark)
f) Does the problem scenario require inferential statistics or only descriptive statistics to
answer the question? Explain your answer. (1 Marks)

Question 76

The marketing director of a company selling security alarms wants to determine the
effectiveness of their recent advertising strategy. Over the past six months, they had varied
both the number of adverts placed per week and the advertising media (press, pamphlets,
magazines) used each week. Weekly sales volume data was recorded as well as the number of
adverts placed per week and the advertising media used each week.

a) Identify the random variables that are in this study. (1 Mark)

b) Which random variable is being predicted? (1 Mark)
c) Which random variables are assumed to be related to the variable being predicted? (1
Mark)
d) Which area of statistical analysis is suggested by this management scenario? (1
Mark)

Question 77 (12 Marks)

The monthly rental per square metre for office space in 30 buildings in Bulawayo central (in
USD) are shown below:

Rentals (USD)

189 156 250 265 376 300

350 315 290 285 225 242

25
 324 280 212 310 395 360
285 225 230 255 185 193
325 248 340 250 285 300

a) Construct a numerical frequency distribution of office rentals by using the classes: (4

Marks)

150−≤200 ; 201−≤250 ; 251−≤300 ; 301−≤ 350 ; 351−≤ 400

b) Compute the percentage frequencies and cumulative percentage frequencies for office
rentals. (4 Marks)
c) From the frequency distribution, answer the following questions:
i. What percentage of office space costs less than or equal to USD 200 per square
metre? (1 Mark)
ii. What percentage of office space costs at most USD300 per square metre? (1
Mark)
iii. What percentage of office space costs more than USD350 per square metre? (1
Mark)
iv. If a legal company that is looking to hire office space is prepared to pay between
USD300 per square metre and USD400 per square metre, how many buildings can
they consider? (1 Mark)

QUESTION 78
The training manager of a company that assembles and exports pool pumps wants to know if
there is a link between the number of hours spent by assembly workers in training and their
productivity on the job.

A random sample of 10 assembly workers was selected and their performances evaluated.

Training hours 20 36 20 38 40 33 32 28 40 24
Output 40 70 44 56 60 48 62 54 63 38

a) Construct a scatter plot of the sample data and comment on the relationship between
hours of training and output. (5 Marks)

26
 b) Calculate a simple regression line, using the method of least squires, to identify a
linear relationship between the hours of training received by assembly workers and
their output. (10 Marks)
c) Calculate the coefficient of determination between training hours received and worker
output. Interpret its meaning and advice the training manager. (5 Marks)
d) Estimate the average daily output of an assembly worker who has received only
twenty-five hours of training. (5 Marks)

QUESTION 79

The operations manager of a sugar mill in Chiredzi wants to estimate the average size of an
order received. An order is measured in the number of pallets shipped. A random sample of
87 orders from customers had a sample mean value of 131,6 pallets. Assume that the
population standard deviation is 25 pallets and that the order size is normally distributed.

Estimate, with 90% confidence, the mean size of orders received from all the mill’s
customers.

(Use the z-table) (10 Marks)

QUESTION 80

The Ministry of Health is concerned that the average percentage mark-up on a particular
vitamin produced is more than 40%. To test their concern, they sampled 76 pharmacies that
sell the product, and found that the mean percentage mark-up was 44,1%. Assume that the
population standard deviation of the percentage mark-up is 14,7%.

a) What is the appropriate test statistic for this management scenario? Why? (3 Marks)
b) Formulate the null and alternative hypothesis for this test situation. (2 Marks)
c) Conduct an appropriate statistical test at 1% level of significance to determine
whether the Ministry of Health’s concern is justified? What conclusions can be drawn
from the findings? (10
Marks)

Question 81

Global insurance has found that 20% of all insurance policies are surrendered (cashed in)
before their maturity date. Assume that 10 policies are randomly selected from the company’s
policy database.

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Required
a) What is the probability that 4 of these 10 insurance policies will have been
surrendered before their maturity date? (5 Marks)
b) What is the probability that no more than three of these 10 insurance policies have
been surrendered before their maturity date? (5 Marks)
c) What is the probability that at least two of the 10 randomly selected policies will be
surrendered before their maturity date? (5 Marks)
Question 82
A web-based travel agency uses its website to market its travel products. The agency receives
an average of five web-based enquiries per day for different travel products.
Required
a) What is the probability that, on a given day, the urgency receive only three web-based
enquiries for its travel products?
b) What is the probability that, on a given day, the travel agency will receive at most two
web-based enquiries for travel packages?
c) What is the probability that the travel agency will receive more than four web-based
enquiries for travel packages on a given day?
Question 83

A Tata truck dealer has established that 5% of new Tata trucks sold are returned for defective
assembly repairs within their 12-month warranty period. Assume that the dealer has recently
sold eight new Tata trucks.

Required

a) What is the probability that only one of the eight Tata trucks will be returned for
defective assembly repairs within its 12 months’ warranty period?
b) What is the probability that at most two of the eight Tata trucks will be returned for
defective assembly repairs within their 12 months’ warranty period?
c) What is the probability that all eight Tata trucks sold are faulty free and will not need
to be repaired due to defective assembly within their 12 months’ warranty period?

Question 84

A telephone helpline receives calls that can be described by a Poisson process. The average
rate at which calls come in is three calls per minute.

Required

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 a) Find the probability that the telephone will receive exactly five calls in a given
minute.
b) What is the like hood that the helpline will receive four or more calls in the given
minute?
c) What chance is there that no calls will be received in a given minute?

Question 85

The manager of a local gym has determined that the length of time patrons spend at the gym
is normally distributed variable with a mean of 80 minutes and a standard deviation of 20
minutes.

Required

a) What proportion of patrons spend more than two hours at the gym?
b) What proportion of patrons spend less than one hour at the gym?
c) What is the least amount of time spent by 60% of patrons at the gym?

Question 86

A business analyst believes that capital utilization (as measured by inventory turnover) has a
direct effect on a company’s earnings yield. To examine this belief, the analyst randomly
surveyed nine companies listed in the Zimbabwe Stock Exchange and recorded their
inventory turnover and their earnings yield. The results are shown in the table below:

Inventory turnover 3 5 4 7 6 4 8 6 5
Earnings yield 10 12 8 13 15 10 16 13 10

Required

a) Graphically display the relationship between inventory turnover and earnings yield for
the nine companies. What relationship can be observed.
b) Calculate the linear regression equation to express the relationship between inventory
turnover and the earnings yield of the companies.
c) Construct the correlation coefficient between inventory turnover and the earnings
yield. Does this make support of the business analyst’s claim?
d) Find the coefficient of determination between the earnings yield and the inventory
turnover.

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 e) What earnings yield can a company expect to achieve if they have inventory turnover
of six next year.

Question 87

The daily electricity consumption in kilowatt hours (kWH) by a sample of 20 households in

Harare is recorded in Table below:

58 50 33 51 38 43 60 55 46 43
51 47 40 37 43 48 61 55 44 35

Required

a) Find the lower quartile value of daily households’ electricity consumption.

b) Find the upper quartile value of daily households’ electricity consumption.
c) Find the median value of daily households’ consumption of electricity consumption.

Question 88

The human resource department of an insurance company analysed the qualifications profile
of their 129 managers in terms of their highest qualification achieved. The findings are shown
in the cross-tabulations table:

Qualification Managerial level

Section head Department head Division head
A’ Level 28 14 ?
Diploma 20 24 6
First degree ? 10 14
Total 53 ? 28

Required

a) Define the two variables, their measurement scale and data type.
b) Complete the above cross-tabulation table (joint frequency table) above.
c) What is the probability that a manager selected at random:
(i) Has an A’ level certificate?
(ii) Is a section head and has a degree?
(iii) Is a departmental head given that the manager has a diploma?

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 (iv) Is a division head?
(v) Is either a division head or a section head?
(vi) Has either A’ Level, or a diploma, or a degree?
(vii) Has a degree given that the person is a departmental head?
(viii) Is either a division head or has a diploma or both?
d) For each probability calculated in (c) above, state:
(i) The type of probability (i.e. marginal; joint or conditional).
(ii) Which probability rule, if any, was applied (i.e. addition rule or multiplication
rule)?
(iii) Are the events in (c)(v) and (vi) mutually exclusive?

Question 89

The following table shows the 300 employees of a glass manufacturing company, cross-
classified on the basis of age and department.

Age Department
Production Sales Administration Total
Less than 30 60 25 18 103
30 – 50 70 29 25 124
More than 50 30 8 35 73
Total 160 62 78 300

Required

a) An employee is selected at random from the company. Calculate the probability that
the employee is:
(i) Under 30 years of age.
(ii) A production worker.
(iii) A sales person between 30 and 50 years of age.
(iv) Over 50 years, given that he or she is in administration.
(v) A production worker or under 30 years, or both.
b) Are the two events, ‘age’ and ‘department’ mutually exclusive? Justify your answer.

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c) Are ‘age’ and ‘department’ statistically independent? Justify your answer.
d) State the probability type and probability rule, if appropriate, used in each of (a)(i) –
(v).

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