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The Amount of Money That Maria Earns in a Week $900\$ 900

Question 92

Multiple Choice

The amount of money that Maria earns in a week is a random variable,X,with a mean of $900\$ 900 and a standard deviation of σm\sigma _ { \mathrm { m } } .The amount of money that Daniel earns in a week is a random variable,Y,with a mean of $800\$ 800 and a standard deviation of σd\sigma _ { \mathrm { d } } .The difference, XY,X - Y, between Maria's weekly income and Daniel's weekly income is a random variable with a mean of $900$800=$100\$ 900 - \$ 800 = \$ 100 If the incomes are independent of one another,which of the following shows the correct method for calculating the standard deviation of the random variable XY?X - Y ?


A) SD(X - Y) = Var(X - Y) = Var(X) + Var(Y) = σm2\sigma _ { \mathrm { m } } ^ { 2 } + σd2\sigma _ { \mathrm { d } } ^ { 2 }
B) SD(X - Y) = Var(XY) \sqrt { \operatorname { Var } ( X - Y ) } = Var(X) +Var(Y) \sqrt { \operatorname { Var } ( X ) + \operatorname { Var } ( Y ) }
= σm2+σd2\sqrt { \sigma _ { \mathrm { m } } ^ { 2 } + \sigma _ { \mathrm { d } } ^ { 2 } }
C) SD(X - Y) = SD(X) + SD(Y) = σm\sigma _ { \mathrm { m } } + σd\sigma _ { \mathrm { d } }
D) SD(X - Y) = SD(X) - SD(Y) = σm\sigma _ { \mathrm { m } } - σd\sigma _ { \mathrm { d } }
E) SD(X - Y) = Var(XY) \sqrt { \operatorname { Var } ( X - Y ) } = Var(X) Var(Y) \sqrt { \operatorname { Var } ( X ) - \operatorname { Var } ( Y ) }
= σm2σd2\sqrt { \sigma _ { \mathrm { m } } ^ { 2 } - \sigma _ { \mathrm { d } } ^ { 2 } }

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