1.

A Gallup survey found that 65% of all financial consumers were very satisfied with their
primary financial institution. Suppose that 25 financial consumers are sampled and if the
Gallup survey result still holds true today, what is the probability that exactly 19 are very
satisfied with their primary financial institution?

2. According to the U.S. Census Bureau, approximately 6% of all workers in Jackson,

Mississippi, are unemployed. In conducting a random telephone survey in Jackson, what is
the probability of getting two or fewer unemployed workers in a sample of 20?

3. According to Information Resources, which publishes data on market share for various
products, Oreos control about 10% of the market for cookie brands. Suppose 20 purchasers of
cookies are selected randomly from the population. What is the probability that fewer than
four purchasers choose Oreos?

4. What is the first big change that American drivers made due to higher gas prices?
According to an Access America survey, 30% said that it was cutting recreational driving.
However, 27% said that it was consolidating or reducing errands. If these figures are true for
all American drivers, and if 20 such drivers are randomly sampled and asked what is the first
big change they made due to higher gas prices,
a. What is the probability that exactly 8 said that it was consolidating or reducing errands?
b. What is the probability that none of them said that it was cutting recreational driving?
c. What is the probability that more than 7 said that it was cutting recreational driving?

5. In the past few years, outsourcing overseas has become more frequently used than ever
before by U.S. companies. However, outsourcing is not without problems. A recent survey by
Purchasing indicates that 20% of the companies that outsource overseas use a consultant.
Suppose 15 companies that outsource overseas are randomly selected.
a. What is the probability that exactly five companies that outsource overseas use a
consultant?
b. What is the probability that more than nine companies that outsource overseas use a
consultant?
c. What is the probability that none of the companies that outsource overseas use a
consultant?
d. What is the probability that between four and seven (inclusive) companies that
outsource overseas use a consultant?

6. According to Cerulli Associates of Boston, 30% of all CPA financial advisors have an
average client size between $500,000 and $1 million. Thirty-four percent have an
average client size between $1 million and $5 million. Suppose a complete list of all
CPA financial advisors is available and 18 are randomly selected from that list.
a. What is the expected number of CPA financial advisors that have an average client
size between $500,000 and $1 million? What is the expected number with an
average client size between $1 million and $5 million?
b. What is the probability that at least eight CPA financial advisors have an average
client size between $500,000 and $1 million?
c. What is the probability that two, three, or four CPA financial advisors have an
average client size between $1 million and $5 million?
d. What is the probability that none of the CPA financial advisors have an average
client size between $500,000 and $1 million? What is the probability that none
have an average client size between $1 million and $5 million? Which probability
is higher and why?
Poisson Distribution
1. On Monday mornings, the First National Bank only has one teller window open for
deposits and withdrawals. Experience has shown that the average number of arriving
customers in a four-minute interval on Monday mornings is 3, and each teller can
serve more than that number efficiently. These random arrivals at this bank on
Monday mornings are Poisson distributed.
a. What is the probability that on a Monday morning exactly six customers will
arrive in a four-minute interval?
b. What is the probability that no one will arrive at the bank to make a deposit or
withdrawal during a four-minute interval?
c. Suppose the teller can serve no more than four customers in any four-minute
interval at this window on a Monday morning.What is the probability that, during
any given four-minute interval, the teller will be unable to meet the demand?
What is the probability that the teller will be able to meet the demand? When
demand cannot be met during any given interval, a second window is opened.
What percentage of the time will a second window have to be opened?
d. What is the probability that exactly three people will arrive at the bank during a
two-minute period on Monday mornings to make a deposit or a withdrawal?
What is the probability that five or more customers will arrive during an eightminute
period?

2. According to the United National Environmental Program and World Health

Organization, in Mumbai, India, air pollution standards for particulate matter are
exceeded an average of 5.6 days in every three-week period. Assume that the
distribution of number of days exceeding the standards per three-week period is
Poisson distributed.
a. What is the probability that the standard is not exceeded on any day during a
three-week period?
b. What is the probability that the standard is exceeded exactly six days of a
three-week period?
c. What is the probability that the standard is exceeded 15 or more days during a
three-week period? If this outcome actually occurred, what might you conclude?

3. The average number of annual trips per family to amusement parks in the United
States is Poisson distributed, with a mean of 0.6 trips per year.What is the probability
of randomly selecting an American family and finding the following?
a. The family did not make a trip to an amusement park last year.
b. The family took exactly one trip to an amusement park last year.
c. The family took two or more trips to amusement parks last year.
d. The family took three or fewer trips to amusement parks over a three-year period.
e. The family took exactly four trips to amusement parks during a six-year period.

Normal Distribution