348 Statistical Methods
good way to locate problem banks
before it is too late.
e. Save your changes to the workbook
and write a report summarizing your
observations.- You’ve been given a workbook which
contains mass and volume measure-
ments on eight chunks of aluminum
from a high school chemistry class.
a. Open the Aluminum workbook from
the Chapter08 folder and save it as
Aluminum Regression Analysis.
b. Plot mass against volume, and notice
the outlier.
c. After excluding the outlier, regress
mass on volume, without the con-
stant term (select the Constant is Zero
checkbox in the Regression dialog
box), because the mass should be 0
when the volume is 0. The slope of
the regression line is an estimate of
the density (not a statistical word here
but a measure of how dense the metal
is) of aluminum.
d. Give a 95% confi dence interval for
the true density. Does your interval
include the accepted true value,
which is 2.699?
e. Save your changes to the workbook
and write a report summarizing your
observations. - You’ve been given data containing
health statistics from 2007 for the 50
states of the United States. The data
set contains two variables: Diabetes
and FluPneum. The Diabetes variable
contains the death rates (per 100,000)
for diabetes while the FluPneum vari-
able contains the death rates for causes
related to the fl u or pneumonia. You’ve
been asked to determine if there is any
correlation between these two measures.
a. Open the Health workbook from the
Chapter08 folder and save it as Health
Correlation Analysis.
b. Compute the Pearson correlation and
the Spearman rank correlation
between them. How does the
Spearman rank correlation differ
from the Pearson correlation? How
do the p values compare? Are both
tests signifi cant at the 5% level?
c. Create the corresponding scatter plot.
Label each point on the scatter plot
with the name of the state. Which
state is a possible outlier on the lower
left of the plot?
d. Copy the data to a new worksheet,
removing the most extreme outlier.
Redo the correlations and your scatter
plot.
e. How are the size and signifi cance of
the correlations infl uenced by remov-
ing that one state? Make a case for the
deletions on the basis of the plot and
some geography. Does the original
correlation give an exaggerated no-
tion of the relationship between the
two variables? Does the nonparamet-
ric correlation coeffi cient solve the
problem? Explain. Would you say that
a correlation without a plot can be
deceiving?
f. Save your workbook and write a re-
port summarizing your observations.- The Fidelity workbook contains fi nan-
cial data from 1989, 1990, and 1991 for
33 Fidelity sector funds. The source is
the Morningside Mutual Fund Source-
book 1992, Equity Mutual Funds.
You’ve been asked to explore the rela-
tionships between some of the fi nancial
variables in this data set. The name of
the fund is given in the Sector column.
The TOTL90 column is the percentage
total return during the year 1990, and
TOTL91 is the percentage total return
for the year 1991. NAV90 is the percent-
age increase in net asset value during
1990, and similarly, NAV91 is the
percentage change in net asset value