Question 1

TABLE 4-9
A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their noncash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members.
-Referring to Table 4-9, if a company is selected at random, what is the probability that the company is small to mid-sized or offers stock options to their board members?

Accepted Answer

The answer of TABLE 4-9
A survey conducted by the Segal...

Question 2

TABLE 4-11
A sample of 300 adults is selected. The contingency table below shows their registration status and their preferred source of information on current events.
 
-Referring to Table 4-11, if an adult is selected at random, what is the probability that he/she is a registered voter?

Accepted Answer

The answer of TABLE 4-11
A sample of 300 adults is...

Question 3

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an ethical practice to explain to clients what the basis of her probability estimate is.

Accepted Answer

It is an ethical practice to explain the basis of the probability estimate to clients, as this helps to ensure transparency and allows clients to make informed decisions about their investments. Failing to provide such information would be seen as unethical, as it could mislead clients and potentially result in them making investment decisions that do not align with their goals or risk tolerance.

Question 4

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, what is the probability that a randomly selected worker had not claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 5

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of exceptionally high gain. It is an unethical practice to tell clients the probability of a loss in her recommendations.

Accepted Answer

It is unethical to only focus on potential gains and not inform clients of the potential risks and probability of loss. Investment consultants have a duty to provide complete and accurate information to their clients in order to make informed investment decisions.

Question 6

TABLE 4-11
A sample of 300 adults is selected. The contingency table below shows their registration status and their preferred source of information on current events.
 
-Referring to Table 4-11, if an adult is selected at random, what is the probability that he/she prefers to get his/her current information from the Internet?

Accepted Answer

The answer of TABLE 4-11
A sample of 300 adults is...

Question 7

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an unethical practice not to also recommend a class of mutual funds with an exceptionally high probability of loss.

Accepted Answer

It is not unethical to recommend only mutual funds with a high probability of gain, as long as the consultant provides a balanced view of risks and potential losses associated with those funds.

Question 8

TABLE 4-9
A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their noncash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members.
-Referring to Table 4-9, is "the size of the company" independent of "whether stock options are offered to their board members" and why?

Accepted Answer

The answer of TABLE 4-9
A survey conducted by the Segal...

Question 9

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, if a randomly selected worker had claimed bias, what is the probability that the worker is white?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 10

TABLE 4-9
A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their noncash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members.
-Referring to Table 4-9, if a randomly selected company is a large company, what is the probability that it offers stock options to their board members?

Accepted Answer

The answer of TABLE 4-9
A survey conducted by the Segal...

Question 11

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, what is the probability that a randomly selected worker is black and had not claimed bias or is white and has claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 12

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, when a randomly selected worker was not white, what is the probability that the worker had not claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 13

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, what is the probability that a randomly selected worker is white and had claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 14

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, if a randomly selected worker had not claimed bias, what is the probability that the worker is white?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 15

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an ethical practice to explain to clients what the meaning of probability is.

Accepted Answer

It is ethical to provide clients with a clear understanding of the investment recommendation, including the meaning and implications of the probability of gain. This allows clients to make informed decisions about their investments.

Question 16

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, what is the probability that a randomly selected worker is not black and had not claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 17

TABLE 4-9
A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their noncash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members.
-Referring to Table 4-9, if a randomly selected company offers stock options to their board members, what is the probability that it is a large company?

Accepted Answer

The answer of TABLE 4-9
A survey conducted by the Segal...

Question 18

TABLE 4-10
Are whites more likely to claim bias? It was found that 60% of the workers were white, 30% were black and 10% were other races. Given that a worker was white, the probability that the worker had claimed bias was 30%. Given that a worker was black, the probability that the worker had claimed bias was 40%. Given that a worker was other race, the probability that the worker had claimed bias was 0%.
-Referring to Table 4-10, what is the probability that a randomly selected worker is black and had not claimed bias?

Accepted Answer

The answer of TABLE 4-10
Are whites more likely to claim...

Question 19

To ethically advertise a school lottery scheme to try to raise money for the athletic department, the organizer of the lottery does not need to explicitly specify the probability of each of the prize in the lottery.

Accepted Answer

It is essential to specify the probability of each prize in the lottery because failure to do so could deceive participants and violate ethical advertising norms. Providing clear and accurate information about the probability of winning could enable customers to make an informed judgment as to whether to participate. Therefore, the organizer must explicitly specify the odds of each prize in the lottery to adhere to ethical advertising standards.

Question 20

You know that the probability of a randomly selected student will cheat on an exam is 1%. You also know that the probability of a randomly selected student will cheat on an exam knowing that his/her fellow classmate is cheating on the exam is also 1%. Which of the following is true about the event of "the randomly selected student cheating on an exam" and "his/her classmate is cheating on the exam"?

Accepted Answer

The events are independent because the probability of a student cheating on an exam is not affected by whether their classmate is cheating or not, based on the given information. Mutual exclusivity means that the events cannot occur together, which is not the case here since a student can cheat even if their classmate is cheating. Collectively exhaustive means that one of the events must occur, which is also not the case since there could be students who do not cheat. Therefore, the correct choice is C, independent.

Quiz 4: Basic Probability

TABLE 4-11 A sample of 300 adults is selected. The contingency table below shows their registration status and their preferred source of information on current events. -Referring to Table 4-11, if an adult is selected at random, what is the probability that he/she is a registered voter?

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an ethical practice to explain to clients what the basis of her probability estimate is.

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of exceptionally high gain. It is an unethical practice to tell clients the probability of a loss in her recommendations.

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an unethical practice not to also recommend a class of mutual funds with an exceptionally high probability of loss.

An investment consultant is recommending a certain class of mutual funds to clients based on its exceptionally high probability of gain. It is an ethical practice to explain to clients what the meaning of probability is.

To ethically advertise a school lottery scheme to try to raise money for the athletic department, the organizer of the lottery does not need to explicitly specify the probability of each of the prize in the lottery.