12) Below is the five-number summary of the hourly wages ($) for advertising / promotion managers.

Min

Q1

Median

Q3

Max

19.64

29.36

34.18

40.86

57.26

a.Would you expect the mean salary for this sample of marketing managers to be higher or lower than the median? Explain.

b.Which would be a more appropriate measure of central tendency for these data, the mean or median? Explain.

c.Calculate the range.

d.Calculate the IQR.

13) Below is the five-number summary of the hourly wages ($) for sales managers.

Min

Q1

Median

Q3

Max

20.94

37.64

44.77

49.34

67.11

Suppose there had been an error and that the lowest hourly wage for sales managers was $18.50 instead of $20.94. Indicate how this change would affect the following summary statistics (increase, decrease, or stay about the same).

a.Mean

b.Median

c.Range

d.IQR

e.Standard deviation

14) The table below shows closing share prices (on the first trading day of August, 2007) for a small sample of companies.

COMPANY

CLOSING SHARE PRICE ($)08/07

3M Dental Products

86.95

Tyco Electronics Power Systems

47.45

Kyocera America Inc.

94.10

Pfizer Inc.

22.39

Xerox Company

17.56

Northrop Grumman Corporation

75.81

Lockheed Martin Maritime Systems

100.17

Sony DADC

51.91

Matsushita Electronic Components

17.91

Foster Wheeler Environmental Corp.

55.67

a.Calculate the mean.

b.Calculate the standard deviation.

c.Standardize the share price for Matsushita Electronic Components (find the z-score). Interpret its meaning.

18) Suppose housing analysts predict that the probabilities for future mortgage interest rates going up, staying about the same, and going down are 0.35, 0.50 and 0.15, respectively. The expected value for building detached homes in a planned retirement community is

A) $2.5 million.

B) $3.625 million.

C) $2.75 million.

D) $875,000.

E) $46.25 million.

19) Based on the expected value approach, the landowner should

A) build townhouses/condominiums if interest rates stay about the same.

B) build detached homes in a planned retirement community.

C) build townhouses/condominiums if interest rates go down.

D) build townhouses/condominiums.

E) build townhouses/condominiums if interest rates go up.

20) The expected value of perfect information is

A) $2.5 million.

B) $3.625 million.

C) $2.75 million.

D) $875,000.

E) $40.00 million.