1.

The requirement that the probability of success remains constant from trial to trial is a
property of the _________________ distribution. 
a. Binomial
b. Uniform
c. Normal
d. Poisson Ans : a
2. The probability that a person catches a cold during the cold and flu season is 0.3. If 10
people are chosen at random, what is the probability that exactly two of them will catch a
cold?

n = 10, p = 0.3, q = 0.7 P( X = 2) = 10C2 (0.3)2 (0.7)8 = 45 x 0.09 x 0.0576 = 0.23

3. Which of the following conditions are not necessary for a distribution to be binomial
distribution.
a) each observation is classified in two categories
b) probability of success remains same.
c) number of observations are large i.e. greater than 30.
d) trial of individual observations are independent of each other. Ans: c
Q4. Discuss the conditions when Binomial distribution can be applied. Discuss the
conditions when Poisson approximation to Binomial can be used.
Solution: Binomial distribution ( also called as Bernoulli distribution) is applicable to
situations with the following characteristics:
(i) An experiment consists of a finite number of independent trials.
(ii) Each trial has only 2 possible, mutually exclusive, outcomes or results which are
termed as success or failure.
(iii) The probability of success, denoted by p, is known and remains constant from trial
to trial. The probability of failure, denoted by q, is equal to 1-p.
(iv) Different trials are independent, i.e. outcome of any trial or sequence of trials has
no effect on the outcome of the subsequent trials.
The sequence of trials under the above assumptions is also known as Bernoulli Trials.

For Poisson distribution answer, please refer notes in class.

Q5. A salesman attends to 8 customers to sell his product. Over a period of time, he has had
the ability to identify customers who would be likely to buy his product and hence considers
the probability of success to be 60%. On any given random day what is the probability that
he will be able to sell to more than 6 customers out of 8 that he has attended.
Ans : Use Binomial distribution
n = 8, p= 0.6, q = 0.4
P( X > 6) = P( X = 7) + P ( X = 8) = 8C7 ( 0.6 ) 7 (0.4)1 + 8C8 (0.6)8 (0.4)0
= 8 x (0.6)7 x 0.4 + 1 x (0.6)8 x 1 = 0.106
6. 10% of the items produced at a plant are defective. A random sample of 9 items is
selected. What is the probability that no more than 2 items are defective in the random
sample selected?
Solution: Use binomial distribution
n = 9, p = 0.1, q = 1-p = 0.9
We have to find P( X ≤ 2 )
7. A Shipment consists of 10000 units of a product in which on an average 2% units are
defective. The quality control department randomly chooses 50 units and checks for
defects. If the quality control department finds 2 or more defects in these 50 units the
entire shipment is returned to the vendor. What is the probability that the shipment is
accepted ( e-1 = 0.3679 )?
Solution: Use Poisson distribution
n = 50, p = 0.02, m = np = 50 X 0.02 = 1
Find P(X < 2) = P( X = 0) + P ( X = 1)

8. Although television HDTV converters are tested before they are placed in the installers
truck, the installer knows that 20% of them still won’t work properly. The driver must install
eight converters today in an apartment building. Ten converters are placed in the truck. What
is the probability that the driver will have enough working converters.

Solution: Use binomial distribution

9.. A salesman goes door – to – door selling his product by giving demonstration. The
probability that the sales will occur on demonstration to a customer is 35%. If the sales man
makes 15 different demonstration in a day
a) what is the probability that he will sell to at least 3 customers on any given random
day.
b) What is the expected number of sales that he will make each day if the probability and
the number of demonstrations will remain the same.
Solution: Use binomial distribution
n= 15, p = 0.35, q = 1-p = 1-0.35 = 0.65
(i) P( X ≥ 3) = 1-[ P( X = 0) + P(X= 1) + P(X =2)]
(ii) Expected no. of sales = mean = np = 15 x 0.35 = 5.25

10. (a) .Harley Davidson, director of quality control for the Kyoto Motor Company, is
conducting his monthly spot check of automatic transmission. In this procedure, 10
transmissions are removed from the pool of component and checked for manufacturing
defects. Historically, only 2 percent of the transmissions have such flaws. (Assume that flaws
occur independently in different transmissions.)
(i) What is the probability that Harley’s sample contain more than two transmissions
with manufacturing flaws?
(ii) What is the probability that none of the selected transmission has any manufacturing
flaws?

Solution: It is a question on binomial distribution

11. A pen company averages 1.2 defective pens per carton (200 pens) produced. The
number of defects per carton is Poisson distributed.
i. What is the probability of selecting a carton and finding no defective pens?
ii. Suppose a purchaser of these pens will quit buying from the company if a carton
contains more than three defective pens. What is the probability that the purchaser will not
buy.
[ e-1.2 = .3012 ] (5 + 5 = 10)
Solution: (i) m = 1.2
P(X =0) = e-1.2 (1.2)0/ 0! = 0.3012 x 1 /1 = 0.3012
(ii) P( X > 3) = 1- [P(X =0) + P (X =1) + P (X =2) + P(X =3)]

12. An insurance company found that only 0.01% of the population is involved in a certain
type of accident each year. If its 1000 policy holders were randomly selected from the
population, then what is the probability that not more than two of its clients are involved in
such an accident next year? (e-0.1 = 0.9048) (5)

Solution: Use Poisson distribution

p = 0.01/100 = 0.0001, n = 1000, m = np = 0.0001x 1000 = 0.1

P(X ≤2 ) = [P(X = 0) + P( X =1) + P( X = 2)]= e-0.1[ (0.1)0 / 0! + (0.1)1 / 1! + (0.1)2 /2 !]

= (0.9048)[1 + 0.1 + 0.005 ] = 0.9998

13. Define a binomial distribution. State the conditions under which binomial probability
model is appropriate.

14. If 10 switches are picked up of which 20% are defective, what is the expected value
of defective switches and variance of defectives. Assume the number of defective switches
follow a binomial distribution.
Solution: Expected value = mean = np
Variance = npq

15. If n= 12, p= 0.3, the variable X is binomial distributed, then find P(X >3).

16. If n= 25, p= 0.02 and X is a binomial distributed variable then find P(X ≥ 2). It is
given that e-0.5 = 0.6065

17. Discuss the business and economic situations where Poisson probability model is
appropriate.
Ans: This distribution can be used as a limiting case of binomial distribution, when the
number of trials n tends to become very large and the probability of success in a trial p tends
to become very small such that their product np remains a constant. This distribution is used
as a model to describe the probability distribution of a random variable defined over a unit of
time, length or space. For example, the number of telephone calls received per hour at a
telephone exchange, the number of accidents in a city per week, the number of defects per
meter of cloth, the number of insurance claims per year, the number of breakdowns of
machines at a factory per day, the number of arrival of customers at a shop per hour, the
number of typing errors per page etc.
Features of Poisson distribution:
(i) It is a discrete probability distribution i.e. the variable X takes only whole number
values.
 (ii) It has only one parameter m.
(iii) The range of the random variable is 0≤ X< infinity
(iv) The Poisson distribution is a positively skewed distribution. The skewness
decreases as m increases.
Uses of Poisson distribution:
(i) This distribution is applicable to situations where the number of trials is large and
the probability of success in a trial is very small.
(ii) It serves as a reasonably good approximation to binomial distribution where n ≥
20 and p ≤ 0.05

Q. A business convention holds its registration on Wednesday morning from 9:00 a.m.
until 12:00 noon. Past history has shown that registrant arrivals follow a Poisson distribution
at an average rate of 1.8 every 15 seconds. Fortunately, several facilities are available to
register convention members. 
(a) What is the average number of seconds between arrivals to the registration area for this
conference based on past results? 
(b) What is the probability that 25 seconds or more would pass between registration arrivals? 
(c) What is the probability that less than 5 seconds will elapse between arrivals? 
(d) Suppose the registration computers went down for a 1-minute period. Would this
condition pose a problem? What is the probability that at least 1 minute will elapse between
arrivals?
 
Answers


The rate of 1.8 arrivals per 15 seconds is equivalent to 1.8/15 = .12 arrivals per second ( or
equivalently 7.2 arrivals per min.) 
a) Average number of seconds between arrivals = 1/.12 = 8.33..sec. 
b) Prob. ( no arrivals for the next 25 sec ) = e^(-.12*25) = e^(-3) ~ .05 
c) Prob( at least one arrival for the next 5 sec) = 1 - e^(-.12*5) = 1 - e^(-.6) ~ .45 
d) Prob( at least 1 minute elapses between arrivals) = e^(-.12*60) = e^(-7.2) ~ .00075 
You expect to have 7.2 arrivals every minute, with several registration facilities, you should
not have any problem processing them.