Pearson eText for An Introduction to Mathematical Statistics and Its Applications -- Instant Access (Pearson+)
6th Edition
ISBN: 9780137549375
Author: Richard Larsen, Morris Marx
Publisher: PEARSON+
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Chapter 11.3, Problem 18Q
To determine
To calculate: A 99% confidence interval for the expected death rate in a country where the cigarette consumption is 2500 per adult per year. A public health official more likely to be interested in a 99% confidence interval for
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step by step on Microssoft on how to put this in excel and the answers please
Find binomial probability if:
x = 8, n = 10, p = 0.7
x= 3, n=5, p = 0.3
x = 4, n=7, p = 0.6
Quality Control: A factory produces light bulbs with a 2% defect rate. If a random sample of 20 bulbs is tested, what is the probability that exactly 2 bulbs are defective? (hint: p=2% or 0.02; x =2, n=20; use the same logic for the following problems)
Marketing Campaign: A marketing company sends out 1,000 promotional emails. The probability of any email being opened is 0.15. What is the probability that exactly 150 emails will be opened? (hint: total emails or n=1000, x =150)
Customer Satisfaction: A survey shows that 70% of customers are satisfied with a new product. Out of 10 randomly selected customers, what is the probability that at least 8 are satisfied? (hint: One of the keyword in this question is “at least 8”, it is not “exactly 8”, the correct formula for this should be = 1- (binom.dist(7, 10, 0.7,…
Kate, Luke, Mary and Nancy are sharing a cake. The cake had previously been divided into four slices (s1, s2, s3 and s4). What is an example of fair division of the cake
S1
S2
S3
S4
Kate
$4.00
$6.00
$6.00
$4.00
Luke
$5.30
$5.00
$5.25
$5.45
Mary
$4.25
$4.50
$3.50
$3.75
Nancy
$6.00
$4.00
$4.00
$6.00
Chapter 11 Solutions
Pearson eText for An Introduction to Mathematical Statistics and Its Applications -- Instant Access (Pearson+)
Ch. 11.2 - Crickets make their chirping sound by sliding one...Ch. 11.2 - The aging of whisky in charred oak barrels brings...Ch. 11.2 - Prob. 3QCh. 11.2 - Prob. 4QCh. 11.2 - Prob. 5QCh. 11.2 - Prob. 6QCh. 11.2 - The relationship between school funding and...Ch. 11.2 - (a) Find the equation of the least squares...Ch. 11.2 - Prob. 9QCh. 11.2 - Prob. 10Q
Ch. 11.2 - Prob. 11QCh. 11.2 - Verify that the coefficients a and b of the least...Ch. 11.2 - Prob. 13QCh. 11.2 - Prob. 14QCh. 11.2 - Prob. 15QCh. 11.2 - Prob. 16QCh. 11.2 - Prob. 17QCh. 11.2 - A graph of the luxury suite data in Question 8.2.5...Ch. 11.2 - Set up (but do not solve) the equations necessary...Ch. 11.2 - Prob. 20QCh. 11.2 - The growth of federal expenditures is one of the...Ch. 11.2 - Prob. 22QCh. 11.2 - Prob. 24QCh. 11.2 - Prob. 25QCh. 11.2 - Among mammals, the relationship between the age at...Ch. 11.2 - Prob. 27QCh. 11.2 - Years of experience buying and selling commercial...Ch. 11.2 - Prob. 29QCh. 11.2 - The following table shows a portion of the results...Ch. 11.3 - Insect flight ability can be measured in a...Ch. 11.3 - The best straight line through the Massachusetts...Ch. 11.3 - Based on the data in Question 11.2.1, the...Ch. 11.3 - Suppose an experimenter intends to do a regression...Ch. 11.3 - Prob. 5QCh. 11.3 - Prob. 6QCh. 11.3 - Prob. 7QCh. 11.3 - Set up and carry out an appropriate hypothesis...Ch. 11.3 - Test H0:1=0 versus H1:10 for the plumage...Ch. 11.3 - Prob. 10QCh. 11.3 - Derive a formula for a 95% confidence interval for...Ch. 11.3 - Which, if any, of the assumptions of the simple...Ch. 11.3 - Prob. 13QCh. 11.3 - Construct a 90% confidence interval for 2 in the...Ch. 11.3 - Regression techniques can be very useful in...Ch. 11.3 - Construct a 95% confidence interval for E(Y2.750)...Ch. 11.3 - Prob. 18QCh. 11.3 - The fuel economy (in miles per gallon) of an...Ch. 11.3 - In the radioactive exposure example in Question...Ch. 11.3 - Attorneys representing a group of male buyers...Ch. 11.3 - Prob. 23QCh. 11.3 - Show that i=1n(YiY)2=i=1n(YiYi)2+i=1n(YiY)2 for...Ch. 11.4 - Prob. 1QCh. 11.4 - Prob. 2QCh. 11.4 - Prob. 3QCh. 11.4 - Prob. 4QCh. 11.4 - Prob. 5QCh. 11.4 - Let the random variable X take on the values...Ch. 11.4 - Prob. 7QCh. 11.4 - Prob. 8QCh. 11.4 - Prob. 9QCh. 11.4 - Prob. 10QCh. 11.4 - Some baseball fans believe that the number of home...Ch. 11.4 - Many people believe that a salary bonus is a...Ch. 11.4 - The extent to which stress is a contributing...Ch. 11.4 - Burglary and larceny both involve the illegal...Ch. 11.4 - A common saying in golf is You drive for show, but...Ch. 11.5 - Suppose that X and Y have a bivariate normal pdf...Ch. 11.5 - Suppose that X and Y have a bivariate normal...Ch. 11.5 - Prob. 3QCh. 11.5 - Suppose that the random variables X and Y have a...Ch. 11.5 - Prob. 5QCh. 11.5 - Give conditions on a0,b0, and u so that...Ch. 11.5 - Prob. 7QCh. 11.5 - In a study of heart disease (79), the weight (in...Ch. 11.5 - Prob. 9QCh. 11.5 - Prob. 10QCh. 11.5 - The National Collegiate Athletic Association has...
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- Faye cuts the sandwich in two fair shares to her. What is the first half s1arrow_forwardQuestion 2. An American option on a stock has payoff given by F = f(St) when it is exercised at time t. We know that the function f is convex. A person claims that because of convexity, it is optimal to exercise at expiration T. Do you agree with them?arrow_forwardQuestion 4. We consider a CRR model with So == 5 and up and down factors u = 1.03 and d = 0.96. We consider the interest rate r = 4% (over one period). Is this a suitable CRR model? (Explain your answer.)arrow_forward
- Question 3. We want to price a put option with strike price K and expiration T. Two financial advisors estimate the parameters with two different statistical methods: they obtain the same return rate μ, the same volatility σ, but the first advisor has interest r₁ and the second advisor has interest rate r2 (r1>r2). They both use a CRR model with the same number of periods to price the option. Which advisor will get the larger price? (Explain your answer.)arrow_forwardQuestion 5. We consider a put option with strike price K and expiration T. This option is priced using a 1-period CRR model. We consider r > 0, and σ > 0 very large. What is the approximate price of the option? In other words, what is the limit of the price of the option as σ∞. (Briefly justify your answer.)arrow_forwardQuestion 6. You collect daily data for the stock of a company Z over the past 4 months (i.e. 80 days) and calculate the log-returns (yk)/(-1. You want to build a CRR model for the evolution of the stock. The expected value and standard deviation of the log-returns are y = 0.06 and Sy 0.1. The money market interest rate is r = 0.04. Determine the risk-neutral probability of the model.arrow_forward
- Several markets (Japan, Switzerland) introduced negative interest rates on their money market. In this problem, we will consider an annual interest rate r < 0. We consider a stock modeled by an N-period CRR model where each period is 1 year (At = 1) and the up and down factors are u and d. (a) We consider an American put option with strike price K and expiration T. Prove that if <0, the optimal strategy is to wait until expiration T to exercise.arrow_forwardWe consider an N-period CRR model where each period is 1 year (At = 1), the up factor is u = 0.1, the down factor is d = e−0.3 and r = 0. We remind you that in the CRR model, the stock price at time tn is modeled (under P) by Sta = So exp (μtn + σ√AtZn), where (Zn) is a simple symmetric random walk. (a) Find the parameters μ and σ for the CRR model described above. (b) Find P Ste So 55/50 € > 1). StN (c) Find lim P 804-N (d) Determine q. (You can use e- 1 x.) Ste (e) Find Q So (f) Find lim Q 004-N StN Soarrow_forwardIn this problem, we consider a 3-period stock market model with evolution given in Fig. 1 below. Each period corresponds to one year. The interest rate is r = 0%. 16 22 28 12 16 12 8 4 2 time Figure 1: Stock evolution for Problem 1. (a) A colleague notices that in the model above, a movement up-down leads to the same value as a movement down-up. He concludes that the model is a CRR model. Is your colleague correct? (Explain your answer.) (b) We consider a European put with strike price K = 10 and expiration T = 3 years. Find the price of this option at time 0. Provide the replicating portfolio for the first period. (c) In addition to the call above, we also consider a European call with strike price K = 10 and expiration T = 3 years. Which one has the highest price? (It is not necessary to provide the price of the call.) (d) We now assume a yearly interest rate r = 25%. We consider a Bermudan put option with strike price K = 10. It works like a standard put, but you can exercise it…arrow_forward
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