1.

The table below shows the United States consumer price indexes for food and medical-

care cost during the years 2000 through 2006 compared with prices in the base years,

1982 to 1984 (mean taken as 100).

a. Plot a scatter diagram and interpret.

b. Compute the Karl Pearson’s Product moment correlation coefficient between the two

indexes, test the statistical significance of the result and interpret.

c. Compute Spearman’s rank correlation coefficient between the two indexes, test the

statistical significance of the result and interpret.

d. Compare the results obtained in (b) and (c), which method is more suitable for the

data and why?

2. A survey of small scale enterprises shows that the average income of employees is

#480,000 per annum with a standard deviation of #64,000. Estimate the percentage of the

enterprises that pay (i) more than an average of #600,000; (ii) less than #300,000 and (iii)

between an average of #400,000 and #500,00.

3.