Chu Hai College of Higher Education ABA102 Business Statistics

In-class Exercise

Chapter 4: Random Variables and Probability Distributions

Solve the problem.

1) Management at a home improvement store randomly selected 125 customers and observed their 1)
shopping habits. They recorded the number of items each of the customers purchased as well as the
total time the customers spent in the store. Identify the types of variables recorded by the managers
of the home improvement store.
A) number of items - continuous; total time - continuous
B) number of items - continuous; total time - discrete
C) number of items - discrete; total time - continuous
D) number of items - discrete; total time - discrete

2) A coin is flipped 6 times. The variable x represents the number of tails obtained. 2)
List the possible values of x. Is x discrete or continuous? Explain.

3) Consider the given discrete probability distribution. Construct a graph for p(x). 3)

x 1 2 3 4 5 6
p(x) .30 .25 .20 .15 .05 .05

4) Consider the given discrete probability distribution. Find P(x < 2 or x > 3). 4)

x 1 2 3 4 5
p(x) .1 .2 .2 .3 .2

5) Consider the given discrete probability distribution. 5)

x 1 2 3 4 5
p(x) .1 .2 .2 .3 .2

a. Find = E(x).

b. Find = E[(x - )2].

c. Find the probability that the value of x falls within one standard deviation of the mean.
Compare this result to the Empirical Rule.

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 6) For a binomial distribution, if the probability of success is .63 on the first trial, what is the 6)
probability of success on the second trial?

7) About 40% of the general population donate time and energy to community projects. 7)
Suppose 15 people have been randomly selected from a community and each asked
whether he or she donates time and energy to community projects. Let x be the number
who donate time and energy to community projects. Find the probability that more than
five of the 15 donate time and energy to community projects.

8) According to a published study, 1 in every 7 men has been involved in a minor traffic accident. 8)
Suppose we have randomly and independently sampled twenty-five men and asked each whether
he has been involved in a minor traffic accident. How many of the 25 men do we expect to have
never been involved in a minor traffic accident?
A) 3.5714 B) 21.4286 C) 25 D) 7

9) Use the standard normal distribution to find P(0 < z < 2.25). 9)
A) .5122 B) .8817 C) .4878 D) .7888

10) Use the standard normal distribution to find P(-2.50 < z < 1.50). 10)
A) .6167 B) .5496 C) .8822 D) .9270

11) The board of examiners that administers the real estate broker's examination in a certain 11)
state found that the mean score on the test was 553 and the standard deviation was 72. If
the board wants to set the passing score so that only the best 10% of all applicants pass,
what is the passing score? Assume that the scores are normally distributed.

12) The tread life of a particular brand of tire is a random variable best described by a normal 12)
distribution with a mean of 60,000 miles and a standard deviation of 6100 miles. If the
manufacturer guarantees the tread life of the tires for the first 52,680 miles, what
proportion of the tires will need to be replaced under warranty?

13) Determine if it is appropriate to use the normal distribution to approximate a binomial 13)
distribution when n = 12 and p = 0.1.

14) Transportation officials tell us that 70% of drivers wear seat belts while driving. Find the 14)
probability that more than 579 drivers in a sample of 800 drivers wear seat belts.
A) 0.7 B) 0.3 C) 0.0668 D) 0.9332

15) Suppose that 88% of the stocks listed on a particular exchange increased in value 15)
yesterday. Let x be the number of stocks that increased in value yesterday in a random of
72 stocks listed on the exchange. Find the mean and standard deviation of x.

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Answer Key
Testname: EXERCISE CHAPTER4

1) C
2) possible values of x: {0, 1, 2, 3, 4, 5, 6}; The variable x is discrete since it has a finite number of distinct possible values.
3)

4) P(x < 2 or x > 3) = p(x = 1) + p(x = 4) + p(x = 5) = .1 + 03 + .2 = .6

5) a. = E(x) = 1(.1) + 2(.2) + 3(.2) + 4(.3) + 5(.2) = 3.3

b. = 2.3 2 (.1) + 1.32(.2) + 0.32 (.2) + 0.72 (.3) + 1.72 (.2) 1.27.

c. P( - < x < + ) = P(2.03 < x < 4.57) = .2 + .3 = .5; The Empirical Rule states that about .68 of the data lie within
one standard deviation of the mean for a mound-shaped symmetric distribution. For our distribution, this value is
only .5, but it is not a surprise that these numbers arent closer since our distribution is not symmetric.
6) Since the probability of success remains the same from trial to trial, the probability of success on the second trial is also
.63.
7) X is a binomial random variable with n = 15 and p = 0.4.

P(x > 5) = 1 - P(x 5) = 1 - 0.4032 (from a binomial probability table)

= 0.5968
8) B
9) C
10) D
11) Let x be a score on this exam. Then x is a normally distributed random variable with = 553 and = 72. We want to
find the value of x 0 , such that P(x > x 0 ) = .10. The z-score for the value x = x 0 is

x0 - x0 - 553
z= = .
72

x 0 - 553
P(x > x 0 ) = P z > = .10
72

x0 - 553
We find 1.28.
72

x 0 - 553 = 1.28(72) x 0 = 553 + 1.28(72) = 645.16

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Answer Key
Testname: EXERCISE CHAPTER4

12) Let x be the tread life of this brand of tire. Then x is a normal random variable with = 60,000 and = 6100. To
determine what proportion of tires fail before reaching 52,680 miles, we need to find the z-value for x = 52,680.

x - 52,680 - 60,000
z= = = -1.20
6100

P(x 52,680) = P(z -1.20) = .5 - P(-1.20 z 0) = .5 - .3849 = .1151

13) cannot use normal distribution
14) C
15) Mean = = .88(72) = 63.36; standard deviation = = 72(.88)(.12) 2.76