BUSI 240: QUESTIONS AND ANSWERS; LATEST UPDATED VERSION, ALREADY GRADED A+

BUSI 240: QUESTIONS AND ANSWERS; LATEST UPDATED VERSION,
ALREADY GRADED A+

Data from a small bookstore are shown in the accompanying table. Complete parts a through e.

a) Prepare a scatterplot of Sales against Number of sales people working.
b) What can you say about the direction of the association?
c) What can you say about the form of the relationship?
d) What can you say about the strength of the relationship?
e) Does the scatterplot show any outliers?

PART A : Prepare a scatterplot of Sales against Number of sales people working. Choose the correct
scatterplot below.

C : gradual increase

PART B : What can you say about the direction of the association?

= It is positive

PART C : What can you say about the form of the relationship?

= It is linear

PART D : What can you say about the strength of the relationship?

= It is strong

PART E : Does the scatterplot show any outliers?

= No

Executives at a large multinational corporation want to be able to predict the average revenue per
month for the whole corporation for a given number of types of product sold. Data on revenue (in
$1,000,000s) and types of product sold were collected for a sample of months. Complete parts a
through c below.

PART A : Which variable is the explanatory or predictor variable?

A : The explanatory variable is types of product sold because the executives want to know how revenue
per month depends on types of products sold

PART B : Which variable is the response variable?

A : The response variable is revenue per month because the executives want to know how revenue per

, month depends on types of product sold

PART C : Which variable would you plot on the y-axis?

B : Since revenue per month (in $ 1,000,000s) is the response variable, it should be plotted on the y -
axis

Assume that the conditions for correlation are met. Is the following statement true or false? If it is
false, explain.

Multiplying every value of y by 2 will double the correlation

Choose the correct answer below.

B : The statement is false. Multiplying every value of y by 2 does not change the correlation

Data from a small bookstore are shown in the accompanying table. A larger firm is considering
acquiring the bookstore. An analyst for the firm notes that the relationship of sales to the number of
sales people working is a strong positive linear association, with no outliers. He suggests that when
they acquire the store they should hire more people because that will drive higher sales. Is his
conclusion justified? What alternative explanations can you offer?

Choose the correct answer below.

B : Correlation does not demonstrate causation. The analyst's argument is that the sales staff causes
sales. However, the data may reflect the store hiring more people as sales increase, so any causation
would run the other way

Data from a small bookstore are shown in the accompanying table. The correlation for the data is
0.953. Complete parts a through d.

a) If the number of people working is 2 standard deviations above the mean, how many standard
deviations above or below the mean do you expect sales to be?
b) What value of sales does that correspond to?
c) If the number of people working is 1 standard deviation below the mean, how many standard
deviations above or below the mean do you expect sales to be?
d) What value of sales does that correspond to?

PART A : If the number of people working is 2 standard deviations above the mean, how many standard
deviations above or below the mean do you expect sales to be?

Sales should be 2 standard deviation(s) ABOVE the mean

PART B : What value of sales does that correspond to?

If the number of people working is 2 standard deviations above the mean, sales should be about 28690