DISC 203

Section 4
Assignment 3

Question 1:
In an experiment to study the relationship of hypertension and smoking habits, the following data are
collected for 180 individuals:

Non – Smokers Moderate Smokers Heavy Smokers

Hypertension 21 36 30

No Hypertension 48 26 19

a) If one person is selected at random, find the probability that the person is experiencing
hypertension.
b) If one person is selected at random, find the probability that the person is experiencing
hypertension, and he is a heavy smoker.
c) If one person is selected at random, find the probability that the person is experiencing
hypertension given he is a heavy smoker.

Question 2:
Suppose we intend to sell a particular equipment to a potential buyer. Denote F be the event that the
buyer has sufficient money and 𝑭𝒄 as a compliment. Also denote B as event that buyer wishes to
purchase the equipment and 𝐵" be the compliment. What is the probability that buyer shall buy given
he has the ability to make a purchase?

Desire

B Bc

F 0.2 0.1
Ability

Fc 0.4 0.3

Question 3:
Past records kept on the Dow Jones Index show that on Mondays the index increases 55% of the
time. During the remainder of the week, the index increases on 60% of the days when it has
increased the previous day, but it increases on only 30% of the days when the previous day’s trading
has resulted in the decrease of the index. What is the probability that next Tuesday’s trading results in
an increase in the Dow Jones Index? (hint: make tree diagram)

Question 4:
An appliance store is going out of business and has 11 televisions left: 5 color consoles, 3 portable
color sets, and 3 black and white sets. Assume that at each sale, each of the remaining televisions has
an equal chance of being selected.
 a) Find the probability that the first set sold is a portable colour set.
b) Given that the first television sold was a portable colour set, find the probability that the
second set sold is a portable colour set.
c) Find the probability that neither of the first two sets sold is black and white.
d) Find the probability that the first two sets sold are the same model.

Question 5:
Only 1 in 1000 adults is afflicted with a rare disease for which a diagnostic test has been developed.
The test is such that when an individual has the disease, a positive result will occur 99% of the time,
whereas an individual without the disease will show a positive test result only 2% of the time. If a
randomly selected individual is tested and the result is positive, what is the probability that the
individual has the disease? (Hint: Bayes Theorem)

Question 6:
A corporation stores spare parts at two warehouses, one in Lahore and one in Karachi. The
number of defective and acceptable spare parts at each warehouse is given below:
Defective Acceptable
Lahore 28 272
Karachi 10 190
If one of the 500 spare parts kept by the firm is chosen at random, D denotes the event that
the spare part is defective and A denotes the event it is acceptable, while L denotes the
event that it comes from Lahore and K denotes the event it comes from Karachi.
(a) Compute:
Compute:
(i) P(A)𝑃(𝐴)
a. = (272+190)/500 = 0.924
(ii) b.
P(A𝑃(𝐴or L)𝑜𝑟= 𝐿)
(28+272+190)/500 = 0.98
(iii) c.
P(A and L) = 𝐿)
𝑃(𝐴 𝑎𝑛𝑑 272/500 = 0.544
(iv) d. 𝑃(𝐿/𝐴)
P (L/A) = 272/(272+190) = 0.589
(b) Suppose someone flips a coin to decide whether to obtain a spare part from Lahore or
Question 7:
Karachi
There is and
an 80%then randomly
chance chooses
that the economy a spare
will bepart
goodfrom
nextwhichever warehouse
year and a 20% is picked.
chance that it will If
bethe
spare
bad. If part chosen is
the economy is defective,
good, therewhat is the
is a 60% probability
chance that
that XYZ it came from
Incorporated willKarachi?
have EPS of Rs.300
and a 40% chance that their earnings will be Rs.250. If the economy is bad, there is a 70% chance
that XYZ Incorporated will have EPS of Rs.150 and a 30% 𝟏𝟎chance that their earnings will be Rs.100.
What is the firm’s expected EPS? 𝟎. 𝟓(𝟐𝟎𝟎 )
𝒑(𝑲|𝑫) =
𝟏𝟎 𝟐𝟖
𝟎. 𝟓 .
𝟐𝟎𝟎 / + 𝟎. 𝟓(
𝟑𝟎𝟎 )
Question 8:
In a particular factory, a motor generates power to be used intermittently by five workers. At any
given time, each worker has the same probability of requiring a unit of power. The workers perform
independently, with the result that the probability that one worker will require power at a certain
moment is the same, whether or not any other worker requires power then. According to a study
carried out by the factory’s engineers each worker uses power for an average of 12 minutes per hour.
So, at a given point in time (minute), the probability that a worker will require power is 1/5.

a) What is the probability distribution for the number of workers requiring power at any given
point in time?
b) If more than two workers require power at the same time, the motor will not function
properly. What the probability of such a malfunction at any given moment (minute)?
 c) What is the expected number of workers requiring power at any given point in time?
d) What is the standard deviation of the number of workers requiring power at any given point
in time?

Question 9:
It has been established that the number of defective stereos produced daily at a certain plant is
Poisson distributed with mean 4 per day. Over a 2-day span, what is the probability that the number
of defective stereos does not exceed 3?

Question 10:
At a certain airfield planes land at random times at a constant average rate of one every 10 minutes.

a) Find the probability that exactly 5 planes will land in a period of one hour.
b) Find the probability that at least 2 planes will land in a period of 16 minutes.

Question 11:
The guarantee associated with consumer products must be carefully determined. The manufacturer
wants to set the guarantee so that very few items will have to be replaced because of failure before
the expiration of the guarantee. Tests on new steel-belted radial tires showed an average tire wear of
40,000 miles and a standard deviation of 3000 miles. If tire wear is assumed to be normally
distributed, how much tire wear should be guaranteed if the manufacturer wishes to replace only 1%
of the tires sold.

Question 12:
Suppose we observe that power failures happen once every 10 hours giving an average of 1/10. What
is the probability that the next power failure will be in more than 15 hours?

Question 13:
A manufacturer advertises that their bottles contain, on the average, 12 ounces of drink. A random
sample of 100 bottles off their production line yielded a sample mean fill of 11.9 ounces, and a
standard deviation of 0.4 ounce. Compute the probability of observing a sample mean fill of 11.9
ounces or less, assuming the manufacturer’s claim is valid.

Question 14:
An auditor takes a random sample of size n= 36 from a population of 1,000 accounts receivable. The
mean value for the accounts receivable for the population is $ 260 with the population standard
deviation of $45. What is the probability that the sample mean will be less than $250? What is the
probability that the sample mean will be within $15 of the population mean?