Exam 4: Basic Probability

The closing price of a company's stock tomorrow can be lower, higher or the same as today's closed. Without any prior information that may affect the price of the stock tomorrow, the probability that it will close higher than today's close is 1/3. This is an example of using which of the following probability approach?

If either event A or event B must occur, then events A and B are said to be

TABLE 4-9 A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their non-cash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members. -Referring to Table 4-9, set up a contingency table.

If P(A and B) = 0, then A and B must be mutually exclusive.

If two equally likely events A and B are mutually exclusive and collectively exhaustive, what is the probability that event A occurs?

TABLE 4-8 According to the record of the registrar's office at a state university, 35% of the students are freshman, 25% are sophomore, 16% are junior and the rest are senior. Among the freshmen, sophomores, juniors and seniors, the portion of students who live in the dormitory are, respectively, 80%, 60%, 30% and 20%. -Referring to Table 4-8, what is the probability that a randomly selected student is a freshman who lives in a dormitory?

A company has 2 machines that produce widgets. An older machine produces 23% defective widgets, while the new machine produces only 8% defective widgets. In addition, the new machine produces 3 times as many widgets as the older machine does. What is the probability that a randomly chosen widget produced by the company is defective?

Suppose A and B are mutually exclusive events where P(A) = 0.4 and P(B) = 0.5. Then P(A or B) = ________.

TABLE 4-8 According to the record of the registrar's office at a state university, 35% of the students are freshman, 25% are sophomore, 16% are junior and the rest are senior. Among the freshmen, sophomores, juniors and seniors, the portion of students who live in the dormitory are, respectively, 80%, 60%, 30% and 20%. -Referring to Table 4-8, if a randomly selected student lives in the dormitory, what is the probability that the student is not a freshman?

If P(A and B) = 1, then A and B must be mutually exclusive.

A company has 2 machines that produce widgets. An older machine produces 23% defective widgets, while the new machine produces only 8% defective widgets. In addition, the new machine produces 3 times as many widgets as the older machine does. Given that a widget was produced by the new machine, what is the probability it is not defective?

TABLE 4-2 An alcohol awareness task force at a Big-Ten university sampled 200 students after the midterm to ask them whether they went bar hopping the weekend before the midterm or spent the weekend studying, and whether they did well or poorly on the midterm. The following result was obtained. -Referring to Table 4-2, the events "Did Well on Midterm" and "Studying for Exam" are

The collection of all the possible events is called a sample space.

According to a survey of American households, the probability that the residents own 2 cars if annual household income is over $50,000 is 80%. Of the households surveyed, 60% had incomes over $50,000 and 70% had 2 cars. The probability that annual household income is over $50,000 if the residents of a household do not own 2 cars is:

The probability that a new advertising campaign will increase sales is assessed as being 0.80. The probability that the cost of developing the new ad campaign can be kept within the original budget allocation is 0.40. Assuming that the two events are independent, the probability that the cost is not kept within budget or the campaign will not increase sales is:

TABLE 4-9 A survey conducted by the Segal Company of New York found that in a sample of 189 large companies, 40 offered stock options to their board members as part of their non-cash compensation packages. For small- to mid-sized companies, 43 of the 180 surveyed indicated that they offer stock options as part of their noncash compensation packages to their board members. -Referring to Table 4-9, if a company is selected at random, what is the probability that the company is small to mid-sized or offered stock options to their board members?

If P(A) = 0.4 and P(B) = 0.6, then A and B must be collectively exhaustive.

TABLE 4-7 The next state lottery will have the following payoffs possible with their associated probabilities. You buy a single ticket. -Referring to Table 4-7, if you have a winning ticket, the probability that you win at least $100.00 is ________.

TABLE 4-5 In a meat packaging plant Machine A accounts for 60% of the plant's output, while Machine B accounts for 40% of the plant's output. In total, 4% of the packages are improperly sealed. Also, 3% of the packages are from Machine A and are improperly sealed. -Referring to Table 4-5, if a package selected at random is improperly sealed, the probability that it came from machine A is ________.

TABLE 4-1 Mothers Against Drunk Driving is a very visible group whose main focus is to educate the public about the harm caused by drunk drivers. A study was recently done that emphasized the problem we all face with drinking and driving. Four hundred accidents that occurred on a Saturday night were analyzed. Two items noted were the number of vehicles involved and whether alcohol played a role in the accident. The numbers are shown below: -Referring to Table 4-1, what proportion of accidents involved more than one vehicle?