The company LINAD wishes to determine a policy for managing the number of defective products. A decisionmaker from LINAD wants to simulate the daily defective items for a number of four days. Consider this probability distribution for the random variable X: ‘’ the number of defective items. Number of defective items Probability 1 0.15 2 0.20 3 0.35 4 0.30
Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
The company LINAD wishes to determine a policy for managing the number of defective products.
A decisionmaker from LINAD wants to simulate the daily defective items for a number of four days.
Consider this
|
Number of defective items |
Probability |
|
1 |
0.15 |
|
2 |
0.20 |
|
3 |
0.35 |
|
4 |
0.30 |
- Compute the cumulative probability for defective products.
- Compute the
expected value of the variable X.
- Explain in detail the 5 steps of Monte Carlo simulation that the decision maker needs to follow.
- Identify three advantages and three disadvantages of simulation.
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