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Scott, MIT Graduate

Category: Homework

Satisfied Customers: 3040

Experience: MIT Graduate (Math, Programming, Science, and Music)

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Customer Question

If two events are not mutually exclusive, then P(A or B) = P(A) + P(B)

Answer True False .

2 points

Question 2

Probability trees are used only to compute conditional probabilities.

Answer True False .

2 points

Question 3

Seventy two percent of all observations fall within 1 standard deviation of the mean if the data is normally distributed.

Answer True False .

2 points

Question 4

The maximin approach involves choosing the alternative with the highest or lowest payoff.

Answer True False .

2 points

Question 5

The Hurwicz criterion is a compromise between the minimax and minimin criteria.

Answer True False .

2 points

Question 6

The minimin criterion is optimistic.

Answer True False .

2 points

Question 7

The equal likelihood criterion assigns a probability of 0.5 to each state of nature.

Answer True False .

2 points

Question 8

A professor would like to utilize the normal distribution to assign grades such that 5% of students receive A's. If the exam average is 62 with a standard deviation of 13, what grade should be the cutoff for an A? (Round your answer.) Answer

80

83

90

93

.

2 points

Question 9

The chi-square test is a statistical test to see if an observed data fit a _________. Answer

Normal probability distribution

continuous probability distribution

particular probability distribution

All of the above

.

2 points

Question 10

Assume that it takes a college student an average of 5 minutes to find a parking spot in the main parking lot. Assume also that this time is normally distributed with a standard deviation of 2 minutes. Find the probability that a randomly selected college student will take between 2 and 6 minutes to find a parking spot in the main parking lot. Answer

0.1950

0.4772

0.4332

0.6247

.

2 points

Question 11

A business owner is trying to decide whether to buy, rent, or lease office space and has constructed the following payoff table based on whether business is brisk or slow.

If the probability of brisk business is .40 and for slow business is .60, the expected value of perfect information is: Answer

12

55

57

69

.

2 points

Question 12

The maximin criterion results in the Answer

minimum of the maximum payoffs

maximum of the maximum payoffs

maximum of the minimum payoffs

minimum of the minimum payoffs

.

2 points

Question 13

A business owner is trying to decide whether to buy, rent, or lease office space and has constructed the following payoff table based on whether business is brisk or slow.

The maximax strategy is: Answer

Rent

Buy

Brisk

Slow

.

2 points

Question 14

A business owner is trying to decide whether to buy, rent, or lease office space and has constructed the following payoff table based on whether business is brisk or slow.

The maximin strategy is: Answer

Buy

Rent

Lease

All three tie.

.

2 points

Question 15

A brand of television has a lifetime that is normally distributed with a mean of 7 years and a standard deviation of 2.5 years. What is the probability that a randomly chosen TV will last more than 8 years? Write your anwsers with two places after the decimal.

Answer .

2 points

Question 16

A life insurance company wants to estimate their annual payouts. Assume that the probability distribution of the lifetimes of the participants is approximately a normal distribution with a mean of 68 years and a standard deviation of 4 years. What proportion of the plan recipients would receive payments beyond age 75? Round your answer to four places after the decimal.

Answer .

2 points

Question 17

A manager has developed a payoff table that indicates the profits associated with a set of alternatives under 2 possible states of nature.

Alt S1 S2 1 10 2 2 -2 8 3 8 5

What is the highest expected value? Assume that the probability of S2 is equal to 0.4.

Answer .

2 points

Question 18

The quality control manager for ENTA Inc. must decide whether to accept (a1), further analyze (a2) or reject (a3) a lot of incoming material. Assume the following payoff table is available. Historical data indicates that there is 30% chance that the lot is poor quality (s1), 50 % chance that the lot is fair quality (s2) and 20% chance that the lot is good quality (s3).

What is the numerical value of the minimax regret?

Answer .

2 points

Question 19

Consider the following decision tree.

What is the expected value for the best decision? Round your answer to the nearest whole number. Answer .

2 points

Question 20

A manager has developed a payoff table that indicates the profits associated with a set of alternatives under 2 possible states of nature.

Alt S1 S2 1 10 2 2 -2 8 3 8 5 Compute the expected value of perfect information assuming that the probability of S2 is equal to 0.4.