FACULTY OF MANAGEMENT AND COMPUTING

BUSINESS MATHEMATICS
STA 117

Term 1, 2012
12 May 2012


Time allowed: THREE HOURS
Total Number of pages: 13 Pages including the cover sheet
General Instructions: 1) This paper has TWO SECTIONS: Section A, and
Section B
2) SECTION A: Answer ALL questions
3) SECTION B: Answer ALL questions
4) Electronic, non-programmable calculators
maybe used.
5) Read the question carefully before answering.
6) Clearly write the question numbers and number
of sub-parts of the questions attempted.
7) Your hand writing should be clear and legible.
8) Answers without working may gain no credit.
9) This paper carries 100 Marks.


SECTION A
THE EXAMINATION PAPER MUST BE COLLECTED IN WITH THE ANSWER SCRIPT
Final Exam: STA 117 2012/S1

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Answer all questions
1. According to the Empirical Rule for normal distributions, approximately what percentage of the data must
fall within 2 standard deviations of the mean?
(A) 50%
(B) 68%
(C) 95%
(D) 99.7%

2. The number of tourists visiting the Maldives varies depending on the quarter of the year. This variation is
fairly predictable. That is, resort owners are aware of when to expect the highest or the lowest numbers of
tourists during the year. This is an example of:

(A) Seasonal variation
(B) Cyclical variation
(C) Secular trend
(D) Irregular variation

3. A qualitative variable that gives rise to exactly two possible outcomes is an example of:
(A) An ordinal variable
(B) A nominal variable
(C) A binary variable
(D) A quantitative variable

4. Which of the following techniques yields a simple random sample?
(A) Choosing volunteers from a business mathematics class.
(B) Grouping individuals by gender and choosing a proportion from each group.
(C) Numbering all the elements of a sampling frame and then using a random number table to pick cases
from the table.
(D) Randomly selecting schools, and then sampling everyone within the school.
5. Geometric mean of a set of values is given by

. The geometric mean of 25, 22,

18, 36 and 20 is:
Final Exam: STA 117 2012/S1

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(A) 17.31
(B) 17.80
(C) 44.5
(D) None of the above
6. The simple interest earned on $45,000 deposited at a 8% p.a. for a period of 6 years 3 months is:
(A) $ 3,600.00
(B) $ 21,600.00
(C) $ 22,500.00
(D) $ 22,680.00

7. Which of the following variables is an example of a qualitative variable?
(A) Currency
(B) Number of children
(C) Shoe size
(D) Type of car

8. Which of the following is the possible strongest correlation?
(A)
(B)
(C)
(D)

Final Exam: STA 117 2012/S1

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The data in the following table is relevant to questions 9 to 11.
The table shows weight distribution of 50 children.

Weight (in kg)
No. of children
30-34
5
35-39
15
40-44
12
45-49
10
50-54
5
55-59
3

9. The mean weight of 50 children, in kilograms, to 1 decimal place is:
(A) 42.4
(B) 44.5
(C) 8.3
(D) 57.1
10. An estimate of the modal weight is:
(A) 46.54 kg
(B) 38.3 kg
(C) 40.5 kg
(D) 47.5 kg




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11. The lower class boundary of 35-39kg is:
(A) 35 kg
(B) 34.5 kg
(C) 39 kg
(D) 39.5kg
12. Given that mean marks of a group of students is 80 and standard deviation is 15. The coefficient of
variation, to the nearest whole number is:
(A) 19%
(B) 21%
(C) 5%
(D) 533%
13. Which of the following is TRUE for a positively skewed distribution?
(A) Mean > Median > Mode
(B) Mode > Mean > Median
(C) Mean < mode < Median
(D) Mean = median = mode
14. Index for a base period is always taken as:
(A) 100
(B) 200
(C) 50
(D) Zero
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15. Which of the following measures how far an observation typically is from the average as a percentage of
the average?
(A) Coefficient of determination
(B) Coefficient of variation
(C) Standard deviation
(D) Inter-quartile range
16. A normal distribution has a mean of 75 and a standard deviation of 12. The z-score corresponding to an
observation of 82 is:
(A) 0.583
(B) 0.915
(C) 0.146
(D) -0.049
17. Long term decline or growth of a time series is known as:
(A) Secular trend
(B) Cyclical variation
(C) Irregular variation
(D) Seasonal variation

18. The measurements of spread or scatter of the individual points around the central point is called:
(A) Measure of central tendency
(B) Measure of dispersion
(C) Measure of skewness
(D) None of the above



Final Exam: STA 117 2012/S1

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19. Which of the following is NOT a type of non-probability sampling?
(A) Quota sampling
(B) Systematic sampling
(C) Snowball sampling
(D) Convenient sampling

20. In financial mathematics, the amount of money borrowed or lend is called:
(A) The principal
(B) The accumulated amount
(C) The future value
(D) None of the above











END of Section A
[Total: 40 marks]
Final Exam: STA 117 2012/S1

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SECTION B
Answer ALL questions
Question 1:
MCHE Bookstore has been selling the Believe It or Not: Wonders of Statistics Study Guide for 12
Semesters and would like to estimate the relationship between sales and number of sections of
elementary statistics taught in each semester. The following data have been collected.
Sales (units) 33 38 24 61 52 45
Number of sections 3 7 6 6 10 12

a) Calculate the regression line of number of sections on sales. (3 marks)
b) Interpret the slope of the regression line. (1 mark)



Question 2:
A firms marketing manager believes that the total sales for the firm next year can be modeled by
using a normal distribution, with a mean of $2.5 million and a standard deviation of $300,000.
a- What is the probability that the firms sales will exceed $3million? (2 marks)
b- What is the probability that the firms sales will fall within $150,000 of the expected level of
sales? (2 marks)
c- In order to cover fixed costs, the firms sales must exceed the break-even level of $1.8 million.
What is the probability that sales will exceed the break-even level? (2 marks)

Final Exam: STA 117 2012/S1

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Question 3:
A company buys four types of raw materials. The prices (in ) and annual quantities used in the years
1999 and 2000 are given below:
Materials 1999 2000


1999 2000
Materials Price Quantity Price Quantity
A 50 90,000 90 80,000
B 60 10,000 50 20,000
C 60 1,000 50 2,000
D 50 25,000 60 20,000
(a) Calculate a simple (unweighted) aggregate price index for these materials in 2000, using 1999 as
the base year. (5 marks)
(b) Calculate an (unweighted) average of price relatives for 2000, using 1999 as the base year.
(5 marks)
(c) Calculate a (weighted) Laspeyres price index for 2000, using 1999 as the base year. (5 marks)
(d) Calculate a (weighted) Paasche price index for 2000, using 1999 as the base year. (5 marks)
(e) Account for the difference between the Laspeyres and Paasche indexes. (5 marks)


Question 4:
A saving scheme involves an initial investment of $1000 and an additional $50 at the end of each year
for the next 5 years. Calculate the receivable sum at the end of 5 years assuming that the annual rate of
interest paid is 8%. (5 marks)

Final Exam: STA 117 2012/S1

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Question 5:

The number of new mortgage loans issued by a building society each quarter for three years is shown
below:

Year Quarter Number of loans
1 1 32

2 46

3 50

4 26

2 1 36

2 48

3 50

4 30

3 1 38

2 48

3 52

4 34



(i) Calculate a centered four-point moving average trend. (5 marks)

(ii) Plot the original data on a graph and plot the moving average trend on the same graph.

(5 marks)

(iii) Calculate the seasonal variation estimates for each quarter. (5 marks)

(iv) Forecast the number of new mortgage loans for the four quarters of year 4. (5 marks)




END of Section B
[Total: 60 marks]
Final Exam: STA 117 2012/S1

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Formula sheet

Laspeyres Index:

Paasches Index:

Z-score:

OR

a=

Laspeyres Index:

Paasches Index:

100 /
100
1
100
1
0
r
x
r
x
t
r
A S
t

|
.
|

\
|
+
+ + =
|
|
|
.
|

\
|
o
n
p
p
= relative Price
k
p
p
k
o
n

|
|
.
|

\
|

=
=
100

indexes price simple the of sum
prices relative of Average
Final Exam: STA 117 2012/S1

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Final Exam: STA 117 2012/S1

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