Question 1

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following:  Refer to Exhibit 5-6.What is the probability that the salesman sells no more than one car during a week?

Accepted Answer

The answer of Exhibit 5-6.The number of cars sold by...

Question 2

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following:  Refer to Exhibit 5-6.What is the standard deviation of the number of cars sold by the salesman during a week?

Accepted Answer

The answer of Exhibit 5-6.The number of cars sold by...

Question 3

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that exactly three of five chosen calculators are defective?

Accepted Answer

This problem can be solved using the binomial probability formula: P(X=k) = nCk * p^k * (1-p)^(n-k), where X is the number of defects, k is the specified number of defects (in this case, 3), n is the sample size (in this case, 5), p is the probability of a defect (in this case, 0.1), and nCk is the number of combinations of size k that can be chosen from a set of size n.

Plugging in the values, we get P(X=3) = 5C3 * 0.1^3 * 0.9^2 = 0.0081. Therefore, the answer is B.

Question 4

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that none in a random sample of four calculators is defective?

Accepted Answer

The probability that a calculator is non-defective is 1-0.1 = 0.9. The probability that all four calculators in the sample are non-defective is:
0.9 x 0.9 x 0.9 x 0.9 = 0.6561
Therefore, the answer is D.

Question 5

A consumer who is risk averse is best characterized as _______________.

Accepted Answer

A risk averse consumer is someone who is not comfortable with taking risks and, therefore, requires a positive expected gain as compensation for taking on such risks. Option A describes a consumer who is not risk averse, while option C describes a consumer who is risk seeking. Option D is not a valid answer.

Question 6

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution:  Refer to Exhibit 5-5.What is the expected number of homes sold by the realtor during a month?

Accepted Answer

To find the expected value, we multiply each possible outcome by its probability and then sum them up. So,

Expected value = (0.05) (0) + (0.15) (1) + (0.35) (2) + (0.25) (3) + (0.15) (4) + (0.05) (5) 
Expected value = 1.2

Therefore, the expected number of homes sold by the realtor during a month is 1.2, which is closest to option B.

Question 7

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What is the probability that two light bulbs will be defective?

Accepted Answer

The probability of exactly two defective light bulbs in a sample of ten can be calculated using the binomial probability formula: P(X=k) = C(n,k) * p^k * (1-p)^(n-k), where n=10, k=2, and p=0.05. This calculation results in approximately 0.0746.

Question 8

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that at least one in a random sample of four calculators is defective?

Accepted Answer

The probability of none of the calculators being defective in a sample of 4 is $(0.9)^4 = 0.6561$. Therefore, the probability of at least one defective calculator is $1-0.6561 = 0.3439$.

Question 9

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following:  Refer to Exhibit 5-6.What is the expected number of cars sold by the salesman during a week?

Accepted Answer

The answer of Exhibit 5-6.The number of cars sold by...

Question 10

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What is the probability that none of the light bulbs will be defective?

Accepted Answer

The probability that none of the light bulbs will be defective is calculated using the binomial probability formula for 0 defective bulbs: (1 - 0.05)^10 = 0.5987.

Question 11

A consumer who is risk neutral is best characterized as ______________.

Accepted Answer

A risk-neutral consumer is not risk-averse or risk-loving, meaning they are indifferent to risk and make decisions based solely on expected values. Therefore, they do not demand compensation for taking risk (B) nor do they accept negative expected gains (A).

Question 12

Exhibit 5-10.According to a study by the Centers for Disease Control and Prevention,about 33% of U.S.births are Caesarean deliveries (National Vital Statistics Report,Volume 60,Number 2,November 2011).Suppose seven expectant mothers are randomly selected. Refer to Exhibit 5-10.What is the probability that 2 of the expectant mothers will have a Caesarean delivery?

Accepted Answer

The answer of Exhibit 5-10.According to a study by the...

Question 13

Thirty percent of the CFA candidates have a degree in economics.A random sample of three CFA candidates is selected.What is the probability that none of them has a degree in economics?

Accepted Answer

The probability that one candidate does not have a degree in economics is 0.7 (since 30% have a degree, 70% do not). Since we are selecting three candidates, the probability that none of them have a degree in economics is 0.7 * 0.7 * 0.7 = 0.343.

Question 14

Thirty percent of the CFA candidates have a degree in economics.A random sample of three CFA candidates is selected.What is the probability that at least one of them has a degree in economics?

Accepted Answer

Let's find the probability that none of them have a degree in economics.
The probability that the first candidate selected does not have a degree in economics is 0.7.
The probability that the second candidate selected does not have a degree in economics is also 0.7.
The probability that the third candidate selected does not have a degree in economics is also 0.7.
Therefore, the probability that none of them have a degree in economics is 0.7 x 0.7 x 0.7 = 0.343.
The probability that at least one of them has a degree in economics is 1 - 0.343 = 0.657.

Question 15

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution:  Refer to Exhibit 5-5.What is the standard deviation of the number of homes sold by the realtor during a month?

Accepted Answer

The answer of Exhibit 5-5.The number of homes sold by...

Question 16

Which of the following statements is most accurate about a binomial random variable?

Accepted Answer

A binomial random variable is a discrete random variable that counts the number of successes in a given number of trials, where each trial has only two possible outcomes (success or failure). It does not have a bell-shaped distribution and is not a continuous random variable. It also does not count the number of successes in a specified time interval or region, but rather in a specified number of trials.

Question 17

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution:  Refer to Exhibit 5-5.What is the probability that the realtor sells no more than one house during a month?

Accepted Answer

The answer of Exhibit 5-5.The number of homes sold by...

Question 18

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What are the mean and variance of the number of defective bulbs?

Accepted Answer

The answer of Exhibit 5-9.On a particular production line,the likelihood...

Question 19

How would you characterize a consumer who is risk loving?

Accepted Answer

A consumer who is risk loving is characterized by their willingness to accept a risky prospect even if the expected gain is negative. This is because they derive satisfaction from taking risks and seek positive outcomes, even if they are not guaranteed.

Question 20

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following:  Refer to Exhibit 5-6.What is the probability that the salesman will sell one car during a week?

Accepted Answer

The probability of selling one car during a week is equal to the proportion of weeks in which the salesman sold one car out of the total number of weeks. In this case, the salesman sold one car in 10 out of 25 weeks, so the probability is 10/25 = 0.40, or 40%. Therefore, the best choice is B.

Quiz 5: Discrete Probability Distributions

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following: Refer to Exhibit 5-6.What is the probability that the salesman sells no more than one car during a week?

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following: Refer to Exhibit 5-6.What is the standard deviation of the number of cars sold by the salesman during a week?

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that exactly three of five chosen calculators are defective?

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that none in a random sample of four calculators is defective?

A consumer who is risk averse is best characterized as _______________.

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution: Refer to Exhibit 5-5.What is the expected number of homes sold by the realtor during a month?

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What is the probability that two light bulbs will be defective?

It is known that 10% of the calculators shipped from a particular factory are defective.What is the probability that at least one in a random sample of four calculators is defective?

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following: Refer to Exhibit 5-6.What is the expected number of cars sold by the salesman during a week?

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What is the probability that none of the light bulbs will be defective?

A consumer who is risk neutral is best characterized as ______________.

Thirty percent of the CFA candidates have a degree in economics.A random sample of three CFA candidates is selected.What is the probability that none of them has a degree in economics?

Thirty percent of the CFA candidates have a degree in economics.A random sample of three CFA candidates is selected.What is the probability that at least one of them has a degree in economics?

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution: Refer to Exhibit 5-5.What is the standard deviation of the number of homes sold by the realtor during a month?

Which of the following statements is most accurate about a binomial random variable?

Exhibit 5-5.The number of homes sold by a realtor during a month has the following probability distribution: Refer to Exhibit 5-5.What is the probability that the realtor sells no more than one house during a month?

Exhibit 5-9.On a particular production line,the likelihood that a light bulb is defective is 5%.Ten light bulbs are randomly selected. Refer to Exhibit 5-9.What are the mean and variance of the number of defective bulbs?

How would you characterize a consumer who is risk loving?

Exhibit 5-6.The number of cars sold by a car salesman during each of the last 25 weeks is the following: Refer to Exhibit 5-6.What is the probability that the salesman will sell one car during a week?