3
QuizMultiple Choice

Modeling for Business: Part Two — Test

Question 3 • Financial Math

What does the standard deviation of 4 purchases per month for loyalty program members suggest about their buying behavior?

Answer
A
All customers who are part of the loyalty program make exactly 10 purchases per month.
B
There was significant variation in the number of purchases made by loyalty program customers.
C
The program did not affect customer purchases.
D
Most customers made fewer than 6 purchases per month.

Explanation

A standard deviation of 4 purchases means customers’ monthly purchase counts typically differ from the average by about 4 purchases. This suggests variation in purchasing behavior among loyalty program members, so A is the best choice. The standard deviation alone does not show whether the program caused the purchases or how many purchases most customers made.

AI-written and checked against the verified answer.

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