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Tutorial 4

This document contains 10 tutorial problems about probability concepts. Problem 1 provides the probabilities of different majors for students at a business college. Problem 2 discusses empirical probability and uses student major data to calculate the probability of selecting a management major. Problem 3 covers classical, empirical, and subjective probabilities using examples like baseball hits and lotteries.

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153 views

Tutorial 4

This document contains 10 tutorial problems about probability concepts. Problem 1 provides the probabilities of different majors for students at a business college. Problem 2 discusses empirical probability and uses student major data to calculate the probability of selecting a management major. Problem 3 covers classical, empirical, and subjective probabilities using examples like baseball hits and lotteries.

Uploaded by

Nayama Nayama
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Tutorial 4

1. A survey of 34 students at the Wall College of Business showed the following majors:

Accounting 10
Finance 5
Economic 3
Management 6
Marketing 10

Suppose you selected a student and observe his or her major.

a. What is the probability he or she is a management major?

Answer:

Probability of getting a student with management major = Total number of


management students / Total Students

Probability = 6/34 = 0.176

Hence the probability he or she is a management major is 0.176

b. Which types of probability did you use to make this estimate?

Answer:

Empirical Probability is used to make this estimate/ Empirical approach.

2. In each of the following cases, indicate whether classical, empirical, or subjective


probability is used.
a. A baseball player gets a hit in 30 out of 100 times at bat. The probability is 0.3
that he gets a hit in his next at bat.

Answer: Empirical

b. A seven-member committee of students is formed to study environmental


issues. What is the likelihood that any one of the seven is chosen as the
spokesperson?

Answer: Classical

c. You purchase one of 5 million tickets sold for lotto. What is the likelihood you
win the $1 million jackpot.

Answer: Classical
3. A sample of 40 oil industry executives was selected to test a questionnaire. One
question about environmental issue required a yes or no answer.
a. What is the experiment?

Answer: The experiment is a survey of 40 people about environmental issue.

b. List one possible event

Answer: One possible event is if all executives answer "NO".

c. Ten of the executive responded yes. Based on these sample responses, what is
the probability that an oil industry executive will respond yes?

Answer: Probability of an event = Number of times events occurs/ Total


number of Observation = 10/40= 1/4= 0.25

d. What concept of probability does this illustrate?

Answer: Empirical approach

e. Are each of the possible outcomes equally likely and mutually exclusive?

Answer: The outcomes are not equally likely, but they are mutually exclusive.

4. The events A and B are mutually exclusive. Suppose P(A) = 0.30 and P(B) = 0.20.
What is the probability of either A or B occurring? What is the probability that the
neither A nor B will happen?

Answer:

P (A or B) = P (A) + P (B) = 0.30 + 0.20 = 0.50

P (neither) = 1 − 0.50 = 0.50

5. A study of 200 advertising firm revealed their income after taxes :

Income after Taxes Number of Firms


Under $1 million 102
$1 million to $20 million 61
$20 million or more 37

a. What is the probability an advertising firm selected at random has under $1


million in income after taxes.

Answer:
Total of firms = 102+61+37
=200
P (income under 1 million) = = 102/200 =.51

b. What is the probability an advertising firm selected at random has either an


income of between $1million and $20 million, or an income of $20 million or
more? What rule of probability was applied?
Answer:
P (income between 1 million and 20 million or more) = (61+37)/200
= 98/200
=0.49
RULE APPLIED
P (A or B) = P(A)+P(B)
6. Suppose the probability you will get an A in class is 0.25 and the probability you will
get B is 0.50. What is the probability your grade will be above C?

Answer: P (above C) = P (A) + P (B)


= 0.25 + 0.50
= 0.75

7. A survey of grocery stores in the Southeast revealed 40 percent had a pharmacy, 50


percent had a floral shop, and 70 percent had a deli. Suppose 10 percent of the stores
have all three departments, 30 percent have both a pharmacy and a deli, 25 percent
have both a floral shop and deli, and 20 percent have both a pharmacy and floral shop.

a. What is the probability of selecting a store at random and finding it has both a
pharmacy and a floral shop?

Answer: P (pharmacy and floral shop) = 0.2

b. What is the probability of selecting a store at random and finding it has both a
pharmacy and a deli?

Answer: P (pharmacy and deli shop) = 0.3

8. Suppose P (A) = 0.40 and PB A =0.3. What is the joint probability of A and B?
Answer: P (A & B) = P(B|A) * p (A)
= 0.30 * 0.40
= 0.12

9. A local bank reports that 80 percent of its customers maintain a checking account, 60
percent have a saving account, and 50 percent have both. If a customer is chosen at
random, what is the probability the customer does not have either a checking or a
saving account?

Answer:

Has either a checking or a savings account: 0.90, found by (0.80 + 0.60) − 0.5

10. Refer to the following table

First Event
Second Event A1 A2 A3 Total
B1 2 1 3 6
B2 1 2 1 4
Total 3 3 4 10

a. Determine P(A1)

Answer:
From the table above, we can see that the total of A1 is 3 and the total of all possible
events is 10.

P (A1) = 3/10 = 0.3

b. Determine PB1 A2

Answer: P (A1) = 3/10 = 0.3

c. Determine P(B2 and A3)


Answer:

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