1-Historical Data Indicates That Only 20% of Cable Customers Are Willing to Switch Companies

1-Historical data indicates that only 20% of cable customers are willing to switch companies. If a binomial process is assumed, then in a sample of 20 cable customers, what is the probability that no more than 3 customers would be willing to switch their cable?

Answer 0.85 0.15 0.20 0.411 0.589

2-Suppose that when the temperature is between 35 and 50 degrees, it has historically rained 40% of the time. Also, historically, the month of April has had a temperature between 35 and 50 degrees on 25 days. You have scheduled a golf tournament for April 12. What is the probability that players will experience rain and a temperature between 35 and 50 degrees?

Answer 0.333 0.400 0.833 1.000 0.480

3-A consulting firm has received 2 Super Bowl playoff tickets from one of its clients. To be fair, the firm is randomly selecting two different employee names to "win" the tickets. There are 6 secretaries, 5 consultants, and 4 partners in the firm. Which of the following statements is true?

Answer

a-The probability of two secretaries winning is the same as the probability of a secretary winning on the second draw given that a consultant won on the first draw.

b-The probability of a secretary and a consultant winning is the same as the probability of a secretary and secretary winning.

c-The probability of a secretary winning on the second draw given that a consultant won on the first draw is the same as the probability of a consultant winning on the second draw given that a secretary won on the first draw.

d-The probability that both tickets will be won by partners is the same as the probability that a consultant and secretary will win.

f-None of these are true.

4A prediction equation for starting salaries (in $1,000s) and SAT scores was performed using simple linear regression. In the regression printout shown below, what can be said about the level of significance for the overall model?

SAT is not a good predictor for starting salary.

The significance level for the intercept indicates the model is not valid.

The significance level for SAT indicates the slope is equal to zero.

The significance level for SAT indicates the slope is not equal to zero.

None of these

5-Data collected on the yearly demand for 50-pound bags of fertilizer at Wallace Garden Supply are shown in the following table. Develop a 3-year moving average to forecast sales. Then estimate demand again with a weighted moving average in which sales in the most recent year are given a weight of 2 and sales in the other 2 years are each given a weight of 1. Which method do you think is best?

YEAR DEMAND FOR FERTILIZER(1,OOOS OFBAGS)
1 4

2 6

3 4

4 5

5 10

6 8

7 7

8 9

9 12

10 14

11 15

6- Develop a trend line for the demand for fertilizer in Problem 5- using any computer software

7- : Passenger miles flown on Northeast Airlines, a com- muter firm serving the Boston hub, are as follows for the past 12 weeks:

Week Actual Passenger

Miles ( 1,000s)

1 17

2 21

3 19

4 23

5 18

6 16

7 20

8 18

9 22

10 20

11 15

12 22

(a) Assuming an initial forecast for week 1 of 17,000 miles, use exponential smoothing to compute miles for weeks 2 through 12. Use Alpha = 0.2.

(b) What is the MAD for this model?

(c) Compute the RSFE and tracking signals . Are they within acceptable limits ?

8-Nick has plans to open some pizza restaurants, but he is not sure how many to open. He has prepared a payoff table to help analyze the situation.

Nick believes there is a 40 percent chance that the market will be good, a 30 percent chance that it will be fair, and a 30 percent chance that it will be poor. A market research firm will analyze market conditions and will provide a perfect forecast (they provide a money back guarantee). What is the most that should be paid for this forecast?

Answer

9- The time required to complete a project is normally distributed with a mean of 80 weeks and a standard deviation of 10 weeks. The construction company must pay a penalty if the project is not finished by the due date in the contract. If a construction company bidding on this contract puts in a due date of 80 weeks, what is the probability that they will have to pay a penalty?

Answer

10 A dry cleaning business offers a pick-up and delivery service for a 10 percent surcharge. Management believes 60 percent of the existing customers will take advantage of this service. They are also considering offering customers the option of opening an account and receiving monthly bills. They believe 60 percent of customers (regardless of whether or not they use the pick-up service) will use the account service. If the two services are introduced to the market, what is the probability a customer uses neither of these services?

Answer

How much should be paid for a perfect forecast of the state of nature?

Answer

12-Suppose that, historically, April has experienced rain and a temperature between 35 and 50 degrees on 20 days. Also, historically, the month of April has had a temperature between 35 and 50 degrees on 25 days. You have scheduled a golf tournament for April 12. If the temperature is between 35 and 50 degrees on that day, what will be the probability that the players will get wet?

Answer