Problem 1 (2 points). Every month a clothing store conducts an inventory and calculates the losses due to theft. The store would like to reduce these losses and is considering two methods to do so: the first is to hire a security guard and the second is to install cameras. The manager of the store has conducted the experiment: During the first 6 months he hired a security guard (method 1) and during the next 6 months he installed cameras (method 2). The monthly losses were reported as follows:
Security guard 350 289 407 398 470 259 Cameras 488 301 276 380 421 425
a/ Test with a=0.05 to determine whether there is enough evidence to conclude that expected monthly loss when installing cameras differs from 382. b/Since the cameras are cheaper than the guard, the manager would prefer to install the cameras unless there was enough evidence to infer that the guard was better. Conduct a hypothesis testing to advise what the manager should do? (Assuming equal variances and using a= 0.05)
Problem 2 (2 points). A supermarket chain performed a survey to help determine desirable locations for its new stores. The management of the chain wanted to know whether a linear relationship exists between weekly take home pay (s) and weekly food expenditures (y). A random sample of eight households produced the data shown in the following table Household 1 3 7 8 2 4 5 6 550 450 560 340 510 710 470 660
170 100 160 80 120 190 140 140 Y
a/ Find the least square regression line.
b/Perform the test Ho: Bi=0, H4: B10 (using a = 0.05) to determine whether there is enough evidence to infer that a linear relationship exists between weekly take home pay (s) and weekly food expenditures (y).
Problem 1 (2 points). Every month a clothing store conducts an inventory and calculates the losses due to theft. The store would like to reduce these losses and is considering two methods to do so: the first is to hire a security guard and the second is to install cameras. The manager of the store has conducted the experiment: During the first 6 months he hired a security guard (method 1) and during the next 6 months he installed cameras (method 2). The monthly losses were reported as follows:
Security guard 350 289 407 398 470 259 Cameras 488 301 276 380 421 425
a/ Test with a=0.05 to determine whether there is enough evidence to conclude that expected monthly loss when installing cameras differs from 382. b/Since the cameras are cheaper than the guard, the manager would prefer to install the cameras unless there was enough evidence to infer that the guard was better. Conduct a hypothesis testing to advise what the manager should do? (Assuming equal variances and using a= 0.05)
Problem 2 (2 points). A supermarket chain performed a survey to help determine desirable locations for its new stores. The management of the chain wanted to know whether a linear relationship exists between weekly take home pay (s) and weekly food expenditures (y). A random sample of eight households produced the data shown in the following table Household 1 3 7 8 2 4 5 6 550 450 560 340 510 710 470 660
170 100 160 80 120 190 140 140 Y
a/ Find the least square regression line.
b/Perform the test Ho: Bi=0, H4: B10 (using a = 0.05) to determine whether there is enough evidence to infer that a linear relationship exists between weekly take home pay (s) and weekly food expenditures (y).
