Answer to selected Chapter 4 questions

Q1 (a) 0.70
(b) 0.49

Q3 2/3

Q5 (a) 0.647
(b) 0.796
(c) 0.299
(d) 0.663

Q7 0.30

Q9 (a) 5/18
(b) 7/9
(c) Not independent
(d) Independent
(e) 1/6
(f)

Q11 (a) 0.6

(b) 0.6
(c) 0.9
(d) 0.25
(e) 2.1
(f) Var = 1.29, stdev=1.136

Q12 (a) 0.25

(b) 0.75
(c) 1.65

Q17 Roulette: expected loss $0.053, house advantage: 0.053

Football: expected loss $0.05, house advantage: 0.045

Q23 (a) 0.68

(b) 0.08
(c) 0.32

Q25 (a) Distribution of number leftover:

Number Leftover Probability
5 0.05
4 0.05
3 0.08
2 0.16
1 0.30
0 0.36
 Distribution of special orders:
Number of Special Orders Probability
0 0.80
1 0.10
2 0.05
3 0.05
(b) E(Number Leftover)=1.31
E(# of special orders) = 0.35
(c) Distribution of weekly profit:
Weekly Profit Probability
$0 0.05
$60 0.05
$120 0.08
$180 0.16
$240 0.30
$300 0.16
$280 0.10
$260 0.05
$240 0.05
(d) $214.40

Q27 (a) E(Demand) 13.8100

Var(Demand) 4.6539
Stdev(Demand) 2.1573
(b) 0.21
(c) 0.64

Q29 E(Demand) 13.8100

Var(Demand) 4.6539
Stdev(Demand) 2.1573

E(Total Cost) $6,905.00

Var(Total Cost) 1163475
Stdev(Total Cost) $1,078.64

Q31 (a) Distribution:

Value Probability
-$8,000 0.273
$0 0.545
$10,000 0.182
(b) Expected gain/loss -$364
Variance 35539504
Standard deviation $5961.50

Q33 0.4929

Q35 (a) No
(b) 0.136
Q37 (a) P(Yankees win series) = 0.53515
(b) Mean $3.00
Stdev $161.51
(c) 0.49491
(d) 0.53385

Q39 Mean profit $10,281

Standard deviation of profit $27,447