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ASB4601/4101- Research Methods- EXAM

All questions carry equal marks

Answer ALL THREE Questions

Question 1
 

I. For the dataset: 10, 10, 30, 50, 40, 50, 20, 30, 10, 20, 40, 120, 20, 30, 50, calculate the max, min, mode, median and mean.(20%)

ANSWER (Purchase full paper to get all the solutions)

I. Using Stata, if the name of the variable holding the data is X, the Stata commands:

summarize X

summarize X, detail

tabulate X

will return a the following:

max = 120; min = 10; mode = 10, 20, 30, 50; median = 30; and mean of 35.33

II. Draw a boxplot with inner and outer fence (20%)

III. For the data in part (i), if the value 120 was replaced by 1200, what would you call this value in the dataset? What could be the explanation for such a value? How can you through the boxplot decide if this value should be excluded from your analysis (10%)
IV. Draw a histogram of the data with three equal sized classes and comment how close to a normal distribution the data look like being (20%)
V. What would be the new values for the three measures of central location with the value of 1200 instead of 120. Comment on the differences (10%)
VI. Calculate the coefficient of variation for the population from which the data are drawn. (20%)

Question 2

A Portfolio consists of six investment products. The expected return of each investment, in million GPB, is normally distributed as follows: Investment I ~ N(71, 16); Investment II ~ N(40, 25); Investment III ~ N(61, 4); Investment IV ~ N(19, 4); Investment V ~ N(20, 16); Investment VI ~ N(29, 4); The returns from the six investments are independent.

I. Find the distribution of the total Portfolio return. Report the mean, the variance and the standard deviation. (40%)
II. If the total return exceeds 250 million GPB, a bonus will be given. What is the probability that this bonus will be given? (30%)
III. If the total return is less than 220 million GPB, the client will look for other firms to handle his money in the future. What is the probability that the firm will keep this customer? (30%)

Question 3
 

The following data are the Years_of_Experience of the brokers in an investment firm, and the Annual_Return_Rates they achieve for whatever funds they control.
Experience (in years)

I. Plot the Annual_Return_Rates against Years_of_Experience and fit a straight regression model to the data. (20%)
II. Plot the residuals from the model against Years_of_Experience. What does this say about the fitted model? (20%)
III. What percentage of variation in Annual_Return_Rates is explained by the regression relationship? (20%)
IV. if we are about to hire a new trader with 33 years of experience, what would be the expected Annual_Return_Rates for him/her? (20%)
V. Why the later result is not exactly 10 as prescribed from the real data (20%)

Last updated: May 27, 2021 01:31 PM