Statistics for Business and Finance (BUS5SBF)

Semester 2, 2015

Assignment 2 Instructions:

1. This assignment should be completed individually and is worth 15% of the total

assessment.

2. Use the data from your Assignment 1, a sample size of 50 households without

replacement from a population of 1000 households in the local community. The data

consists of the Weekly Income (WI), Weekly Expenditure on Food (WEF), the Highest

Level of Education in the Household (HLE), the Family Size (FS), and the Gender of

the Head of the Household (G). Use SPSS or EXCEL for computation ONLY.

3. Submission is online. Make sure you follow the instructions otherwise your assignment

will not be accepted.

DUE DATE: 16th October 2015 by 5 PM

(10% penalty per day)

SUBMISSION INSTRUCTIONS:

Submit your assignment by uploading your assignment file (ONLY ONE

MICROSOFT WORD FILE or PDF; DO NOT ATTACH ZIP FILES) via

LMS (Moodle) on BUS5SBF website under Extra Files (Assignment 2

submission link) and make sure the filename reads as follows: STUDENT ID

STUDENT NAME (eg. 12345678 John Smith). The date and time you upload

your assignment will represent the date and time you hand in your assignment.

STATEMENT OF AUTHORSHIP SHOULD BE ATTACHED WITHIN

THE SAME FILE. (TURINITIN REQUIREMENT)

Please do not forward your assignment to your Tutor or lecturer via e-mail -

Just submit on LMS

Answer the following questions: (100 Marks in total) 1. Provide 95% confidence interval estimates for the mean FS (FS)

WEF (WEF) and WI (WI) for the population of 1000 households

based on your selected sample of size 50 households. (15 Marks)

2. Test the following Hypothesis that the population average

(i) Family Size is three.

(ii) WI is at least $500.

(iii) WEF is greater than $300

Against a suitable alternative at the 10% level of significance.

What can you conclude? (15 Marks)

3. Estimate the following least square regression lines and explain

the meaning of the y-intercept (b0) term and the estimate of slope

coefficients (b1) in (i) and (ii) below but (b1 & b2) in (iii) :

(i) WEF on WI

(ii) WEF on FS

(iii) WEF on WI and FS

(15 Marks)

4. Construct confidence intervals for the estimates of the slope

coefficients in (i) to (iii) of Question 3. Explain the meaning of

these confidence intervals and comment on your results about the

width of the confidence intervals, if sample size increases from

50 to 100. (10 Marks)

5. Find the values of the correlation coefficients and the coefficients

of determination, and explain their meaning for the 50 pairs of:

(i) WI and WEF values

(ii) WEF and FS values

(15 Marks)

For question 6 and 7 below please refer to the excel files (extra file

for assignment 2 on LMS)

6. In that excel file (Oslo tab), there is 50 sample data of Weekly

Income (WI), Weekly Expenditure on Food (WEF) of one of the

most prosper city in the world, Oslo, Norway. Prime Minister of

Norway Erna Solberg claimed that:

(i) The population average of Weekly Income (WI) for her city

is higher compared to your sample of 50 households.

(ii) The population mean of Family Size (FS) for her city is at

least the same with your sample of 50 households.

Based on the Erna Solbergs statement, perform the analysis on

hypothesis testing with level of significance of 5%. Do you think

Erna Solbergs statement is true?

There are few assumptions that you may need to put in your mind,

when you perform this test:

A. Populations for both of your sample data and OSLO are

normally distributed and samples are independent.

B. Population variances for Weekly Income (WI) are unknown

and unequal.

C. Population variances for FS are unknown and equal.

(20 Marks)

7. As one of the largest city in USA, New York also known as the

food city. In this city people spend so much money in food, and

Bill de Blasio, Mayor of New York believe, that the average

amount of weekly food expenditure (WEF) spent by households

is equal with your sample data. In order to prove that he collects

a random sample of 50 households data of his city. (The data is

attached on extra file for assignment 2, New York tab).

Based on the Bill de Blasios statement, perform the analysis on

hypothesis testing with level of significance of 5%. Do you think

Bill de Blasios statement is correct?

You may consider the following assumptions while performing

this test:

A. Populations for both of your sample data and New York are

normally distributed and samples are not independent.

B. Population variances of Weekly Food on Expenditure (WEF)

are unknown and unequal.

(10 Marks)