WEEK 6
1. Point Estimates for EAI Employees. In this chapter we showed how a simple random sample of 30 EAI
employees can be used to develop point estimates of the population mean annual salary, the
population standard deviation for annual salary, and the population proportion having completed the
management training program.
a. Use Excel to select a simple random sample of 50 EAI employees.
b. Develop a point estimate of the mean annual salary.
c. Develop a point estimate of the population standard deviation for annual salary.
d. Develop a point estimate of the population proportion having completed the management
training program.
2. Production Operating Costs. Suppose a new production method will be implemented if a hypothesis
test supports the conclusion that the new method reduces the mean operating cost per hour.
a. State the appropriate null and alternative hypotheses if the mean cost for the current production
method is $220 per hour.
b. What is the Type I error in this situation? What are the consequences of making this error?
c. What is the Type II error in this situation? What are the consequences of making this error?
3. Meal Costs. Which is cheaper: eating out or dining in? The mean cost of a flank steak, broccoli, and
rice bought at the grocery store is $23.04. A sample of 100 neighborhood restaurants showed a mean
price of $22.75 and a standard deviation of $2 for a comparable restaurant meal.
a. Develop appropriate hypotheses for a test to determine whether the sample data support the
conclusion that the mean cost of a restaurant meal is less than fixing a comparable meal at home.
b. Using the sample from the 100 restaurants, what is the p value?
c. At α = 0.05, what is your conclusion?
ICT761 Tutorial
ICT103: Tutorial 1 Compiled by: Shaleeza Sohail Week 6
